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HomeMy WebLinkAbout1986-09-02 City Council Summary MinutesCITY COUNCIL MIMUTEN ITEM Oral Communications Minutes of July 28, 1986 CITY OF Pit0 ALTO Regular Meeting September 2, 1986 1. Appointment of Historic Resources Board Member to Pill the Unexpired Term of Linda Northway Ending May 31, 1988 PAGE 7 6 3 1 7 6 3 4 7 6 3 4 2-A (Old 2). Amendmeints to the Palo Alto Municipal 7 6 3 5 Code re Council Rules and Notice Procedures 3. Public Hearing: Planning Commission Recommendation re Application of Clement Chen and Associates for Modification of Planned Community District 2637.to Add 64 Guest Rooms and Restaurant Space at 625 El Camino Real (The Holiday Inn) (Continued from 8/11/86) 4. Request of Councilmember Fletcher re City Use of Recycled Paper (Continued from 8/25/86) 5. Urgency- Ordinance Imposing a Moratorium on Development Within the City of Palo Alto for Uses Not in Conformance with the Floor Area Ratic Policy for the Golden Triangle Task Force (Continued from 8/25/86) 6. Golden Triangle - Agreement with Santa Clara County Manufacturing Group (Continued from 8/25/86) 7. Amendments to the Below -Market --Rate (BMR) 7 6 5 Rental Guidelines. Adjournment 4t 1000 30 p.m. Final Adjournment at 12*20 a.m. 7 6 3 5 7 6 4 7 7 6 4 8 7 6 4 8 7 6 5 9 7 5 5 9 7 6 3 0 9/02/06 Regular Meeting Tuesday, September 2, 1986 The City Council of the City of Palo Alto met on this date in the Council Chambers, 250 Hamilton Avenue, at 7:30 p.m. PRESENT: Bechtel, Cobb, b1etcher., Klein, Levy, Patitucci, Renzel, Sutorius, Woolley Mayor Cobb announced that a special meeting to interview Visual Arts Jury candidates was at 6:50 p.m. in the Council Conference Room. He also announced the need for a Closed Session re Personnel to be held after the regular meeting. ORAL COMMUNICATIONS 1. Scott Anderso, 3084 Stelling Drive, was saddened by Council's decision to close the stables. 2. Larry Faber, - 3127 David Avenue, requested reconsideration of the Arastra stables. 3. Susan Dunn, 2260 St. Francis Drive, urged reconsideration of the decision to close the Arastra barn. She was influenced to reside in Palo Alto three years ago because of its recrea- tional opportunities and since her decision three barns have closed. She currently rode from a barn in Los Altos Hills which reserved the right to restrict use of the facility to Los Altos Hills residents. She might lose her ability to ride altogether and she was concerned. 4. Sue Ivy, 1983 San Luis, #6, Mountain View, said over 400 sig- natures were submitted to the City of Palo Alto of people who wanted to see the barn given another chance. The original decision was based on inaccurate traffic data; went contrary to the Palo Alto staff recommendation; and assumed the barn could not generate sufficient revenue to financially support itself and pay its ?air share of the road. She challenged the third assumption and said the barn was an underutilized source of avenue. The horse count could be . returned to its original 45 by admitting only Palo Alto residents. The barn presently had a waiting list which Zar exceeded the 15 Palo Alto resi- dents necessary to increase the horse count to 45. The rate structure could be re-evaluated since some of the current rates were somewhat below what was charged in adjacent areas. There were few barns left in the Palo Alto area against :which to oompare. A program could be instituted with limited public use of the arena which could be used to generate revenue for specific projects. All of the revenue generating activities 7 6 3 1 9/02/8 could be readily implemented if the City would reconsider its decision to close the barn and allow the stable people to work with the Palo Alto staff to develop long range financial and upgrade plans. The barn was not just a source of general revenue, it enhanced life in the community. The 400 signa- tures collected from Palo Alto residents in four working days indicate., a strong interest and public support for the civic enhancement. She urged reconsideration. 5. Dori Lopes, 3980 El Camino Real, t44, urged reconsideration of the decision to close the barn on the Arastra property. She hiked in the area and she especially enjoyed the horses at the barn. 6. Mildred Scranton. 747 Josina Avenue, urged reconsideration of the Council's decision to close the Arastra barn. Stables were greatly needed in the area. opera and the borders had to hunt Council discussed the fact there Biers. It was not due to lack Many stables went to level -- for places for their horses. were only ten Palo Alto bor- of interest. There was a waiting list of Palo Altans. Money was spent to reroof the barn, for water; and for fencing at which time Council must have believed it was worth it. It was difficult to ••understand why Council believed it was necessary to close the barn since it was needed and self-sustaining. 7. William R. Smith, 1873 Edgewood Drive, said he and his wife started riding horses on the Arastra property in 1964. He supported the barn. 8. Donie Hubbard, 25128 La Loma Drive. Los Altos Hills, referred to a letter dated, August 30, 1986 (on file .in the City Clerk's office). from various parties, which urged the City Council to reverse its decision to close the Arastra barn. There were never enough horse facilities in Palo Alto to meet the needs of families` who enjoyed horse activities. It was always necessary to travel to neighboring communities to have riding lessons or board a horse. Closing the last barn in. Palo Alto would be a Lass to the community. Press coverage of the Arastra barn closure indicated Council did not believe there were enough people in Palo Alto interested in horses to justify keeping the barn open. She was a board member of the Los Altos Hills owned Westwind Barn, which was owned by the town. She submitted a list of Palo Alto residents who used the Los Altos facilities. She urged reconsideration, Those involved with horses. barns, or 4-11 programa knew that a des- perate need was created each time a barn WAS torn down to pave the way for development. A publicly maned barn was a treasure because it could be preserved for community use. It deserved to be saved, 7 6 3 2 9/02/86 9. Dr. Don Miller, 502 Valencia, Los Altos, was President of the Los Altos Trails Club, a group of Peninsulans with horses and interested in riding. There were 75 members in the club, 15 of whom were Palo Alto residents. They rode on the Arastra property in the spring. He boarded his horses at the Arastra barn for the past . six years. He did many of the repairs at the Arastra barn with fencing. He urged Council reconsidera- tion to keep the barn open. 10. Roy Stark, 4000 El Cerrito Road, said the stables were very clean and it was impressive to others. 11. Robert Stutz, 25310 Elena Road, Los Altos Hills, was President of the Los Altos Hills Horsemen's Association, which was formed to protect and extend the use of horses in Los Altos Hills. Over the years they had to engage in political discus- sions, the most recent of which was the rebuilding of the Town ring where the Town of Los Altos Hills put up $6,000 to supply drainage, and the horsemen rebuilt the otructure for another $2,000. Of those involved in the construction of the ring: 60 percent were not residents of Los Altos Hills. It was evi- dence that the horse community was a cohesive, cooperative group in the area. He believed parkland such as Arastra, which were trail and nature oriented, were natural sites for such facilities an.d Council would be remiss to destroy the barn. 12. George Parker, 1151 Parkinson Avenue, said he, hia wife and two sons had horses at the barn for ten years, and attested to the personal experience that it was a rich part of the Palo Alto heritage. Many Palo Altans supported the barn, and given an opportunity, he believed the barn could be on a self- sufficient basis at least as self-sufficient as the youth hostel -- He urged reconsideration. 13. Saskia Boissevain, 410 Cambridge Avenue, said many people were involved with the Arastra barn that were capable of making it self-sufficient and a money maker. She was on the waiting list to get into the krastra barn for many years with little hope. Many people in Palo Alto were interested in equestrian activities and she urged reconsideration. 14. Christine Cole, 23219 Revensbury, Los Altos, owned Fallhouse Farm in Los Altos Hills for seven years. She saw an extreme increase in the need for stabling. She had a long waiting list and _ believed the need was desperate. People kept horses As far away as San Juan Bautista and had to drive that far two or three times a week. Many children went to her stables, and she urged reconsideration. 7 6 3 3 9/02/86 15. Eric Willis, 2361 Byron Street, urged reconsideration because the barn, trails, and system were a unique blessing to Palo Alto. There was a lot of talent in the community for volun- teer labor and ideas to improve the facility and give some suggestions in terms of the economics. There were many groups in Palo Alto who could be involved with the barn that presently were not. MINUTES OF JULY 28, 1986 NOTIONS Councilmember Bechtel moved, seconded by Pletcher, approval of the minutes of July 28, 1986, as submitted. NOTION PASSED by a vote of 8-0-1, Sutorius abstaining. SPECIAL ORDERS OF THE DAY 1. APPOINTMENT OF HISTORIC RESOURCES BOARD MEMBER TO FILL THE UNEXPIRED TERM OF LINDA NORTHWAY ENDING MAY 31, 1988 (COU-5-9.2 ) Mayor Cobb said the applicants were Don Mullen and Janet Stewart. Vice Mayor Woolley . said the City was fortunate to have capable applicants. She would support Don Mullen because he owned an historic property, he was experienced, restored his Downtown building, worked extensively with his own home, and had an incred- ible amount of time. Councilmember Levy said both applicants were outstanding. He leaned towards Ms. Stewart. Her legal backgroueW could be valu- able and while she was not directly involved in the renovation of any historic building, she served on the Palo Alto Housing Corporation. As a studens of foreign language and cultures, she had a diverse perspective. FIRST ROUND OF VOTING City Clerk Gloria Young announced the results of the .first round of voting: VOTING FOR STEWART: Levy, Cobb, Klein, Patitucci VOTING FOR M3LLEN: Fletcher, Bechtel, Sutorius, Woolley, Renzel Me. Young announced Mr. Mullen received five votes and was appointed. !'Mayor Cobb congratulated Mr. Mullen. 7 6 3 4 9/02/86 CONSENT CALENDAR Mayor Cobb removed 2, Amendments to Palo Alto Municipal Code re Council Rules and Notice Procedures, from the Consent Calendar. AGENDA CHANGES, ADDITIONS AND DELETIONS Assistant City Man.gei June Fleming Said Item 2, Amendments to Municipal Code, would become 2-A. 2-A. AMENDMENTS TO THE PALO ALTO MUNICIPAL CODE RE COUNCIL RULES AND NOTICE PROCEDURES (LEG 5) Counc ilrnermber Fletcher referred to . Section 1, of the Palo Alto Municipal Code (PAMC) Section 2.04.050, and wanted to change the wording to reflect that all packet materials, etc. would be received .12y, the preceding Thursday. Mayor Cobb wanted to change PAMC 2.04.060(b) to reflect "Items to be considered after 10:00 p.m." rather than 10:30 p.m. MOTION: Mayor Cobb moved, seconded by Sutorius, to adopt the ordinance with the following revisions: Section 1, PAMC 2.04.050, change the wording to "deliver to the City Clerk ";' --Section 2, PAMC 2.04.060(b), change the wording to "Items to be considered after 10:00 p.m. At 10:00 p.m. the city council..." ORDINANCE FOR FIRST READING entitled "ORDINANCE OF THE an-C-11-7517-THE—CYTY-151-VAL4—ALTO AMENDING CHAPTER 2.04 OF THE PALO ALTO. MUNICIPAL CODE REGARDING REVISIONS TO COUNCIL RULES, CHAPTER 2.00 REGARDING OATHS OF OFFICE AND CHAPTERS 4.04,. 12.16, AND 16.32 RING RESPONSIBILITY FOR PROVIDING NOTICES IN VARIOUS TYPES OF PROCEEDINGS" 'ION. PASSED. unanimously. 3. PUBLIC HEARING: PLANNING COMMISSION RECOMMENDATION RE APPLICATION OF CLEMENT CHEN AND ASSOCIATES FOR MODIFICATION OF PLANKED COMMUNITY DISTRICT TO ADD 64 GUEST ROOMS_ AND RESTAURANT SPACE. AT . 62 EL CAMINO REAL (THE HOLIDAY INN) (Continued from 8 l 1 I PLA CMR: 427: ) Counciimember Fletcher asked how the project overall compared with the data given in favor of the PC . whelA it was . on the ballot, .where it said that 85.5 percent of the total area would be in open space, 55 percent of the parcel beautifully landscaped, and the low-rise structures covering only 15.4 percent of the land. Director of Planning and Community Environment Ken. Schreiber said the existing site had 16.2 percent building coverage... With: the 7 6 3 5 9/02/86 proposed addition, the coverage would become 20.5 percent versus the 15.5 percent cited in the ballot argument. The reference in the ballot argument to 85 percent open area needed to included all other portions of the site. Currently the site had 29.4 percent landscaping and water garden area, and. that would drop to 25.5 percent under the proposal. The remainder of the area was in either automobile . or pedestrian traffic related or swimming pool related paving or hard surface. Mayor Cobb declared the public hearing open. Clement Chen, Jr., 290 Sierra Drive, Hillsborough, lived in Palo Alto for many years. He believed everybody was familiar withthe subject project. The hotel was opened in September 1973, operated continuously since that date, and enjoyed successful and good patronage from guests in the area as well as from citizens at large. They felt it was time to consider adding a small number of rooms and perhaps a specialty restaurant which would increase the amenities and meet the demands of their operation. Since the Holiday Inn opened, the records showed it contributed to the City's financial income in excess of $6 million on ground rent, hotel tax, and sales tax alone. They;, would like to have Council consider the proposal to add a total of 64 units to the existing 280 units. The design and construction would be in keepiig with the existing structure of no more than four stories with a mission -tile roof, and they would provide underground parking of 70 spaces so there would not be additional parking on the surfaces. If the proposal was approved that evening, they would be able to enclose the courtyard and water garden as intended in the original proposal. His staff worked closely with City staff, both in planning and in traffic and other areas. John Newman, 3906 Sacramento Street, San Francisco, said the Council and the Palo Alto Holiday Inn had time to reflect on issues affecting growth in the Downtown core, as well as elements in the project. As promised in April, they participated in the hearing process on the Downtown Study to see if they could incor- porate useful suggestions, concepts, and themes derived and estab- lished by the City Council. The themes were isolated, into three major areas: A review of traffic, a review of parking and parking deficits, and a review of growth as it applied to the City in generals With respect to traffic, the Holiday Inn worked dili- gently with City staff in the preparation of a traffic study prior to the submission of the application, the reviews of which con- firmed there would be no significant adverse impacts on traffic from the hotel in the surrounding intersections. With respect to parking, the Council identified in the Downtown Study issues per- taining to parking deficits. In the original concept of the hotel addition, they planned to provide a number of additional spaces above and beyond Code to remove any concern the hotel might be contributing to a perking deficit in the areas adjacent to the 7 6 3 6 9/02/86 property. After review of the subject with the City Attorney's office, there was a possibility of committing spaces on the prop- erty for permit perking if desired and instructed by Council. The Holiday Inn listened carefully to Council on issues of growth with respect to FAR and learned there were areas where there would be additions or bonuses for FAR if projects had unique benefits. Subsequent to the conclusions in the Downtown Study, Council adopted objectives of the Golden Triangle Study which specifically provided exemptions for hotel and restaurant facilities. Per- taining to FAR, they believed the\ -proposal was consistent with the activities and concepts adopted by the City Council. The project was correct for competitive building. The addition represented approximately a 6 percent addition of rooms in.. the Palo Alto market, and they believed it was necessary to provide an upscale - type room to remain competitive with competition that came into the market place since the hotel opened in 1973. They provided financial projections for staff's and '.Council's review and believed those projections were obtainable and conservative. There were projections in 1973 about revenues forthcoming to the City, and their operations more than exceeded the greatest expec- tations. While they could not guarantee that type of success for the future, they would try to maintain the success and quality of the hotel as was done for the past ten years. He introduced Mr. Ogden, a traffic engineer, who was available to answer any ques- tions pertaining to the traffic impact study and its subsequent additions (on file in the City Clerk's office). The project.pro- v:ided a significant public benefit to the people of Palo Alto. Councilmember Bechtel said Mr. Newman asked for a continuance to that evening in order to more fully explore the parking contri- bution. She asked what the Holiday Inn had in mind. Mr. Newman said the Holiday Inn requested the continuance for the purpose of trying to ameliorate the parking deficit issue. The Holiday Inn indicated a willingness to commit 30 parking spaces in an area to be selected in consultation with the City's Transportation Division, and Planning Department, or per Council's direction. They suggested the parking spaces be as close as pos- sible to the University circle railroad area. Councilmembers saw during site inspections the Holiday Inn had a fair amount of sur- plus parking during the daytime. As they had additional spaces above Code, it was their understanding they could commit spaces for public use . and that a . City permit parking program, perhaps between the hours of 8:00 a.m. and 6:00 p.m., would be a benefit to the City. Basically, they understood they were legally able to make that commitment and would work per Council's direction. Councilmember Bechtel said Council received no additional material in the intervening two weeks. 7 6 3 7 9/02/86 Assistant City Manager June Fleming said staff received on Friday an outline of seven items entitled "Outline of Public Benefits," (on file in the City Clerk's office), and copies would be distrib- uted to Council. Counciimember Levy asked if the Holiday Inn was in a position to commit a minimum number of spaces. Mr. Newman said the number of spaces. spaces,which were no exact number depended on the legally --required He understood they were only able to commit t for required parking. Counciimember Levy clarified the number of spaces would be a mini- mum of 3G,. Mr. Newman said that was correct. Counc ilmember Renzel asked what the Holiday inn would do if the City ever decided to exercise its option to open Urban Lane on which the Holiday Inn currently had an encroachment permit with about 100 parking spaces. Mr. Chen said they did not know the City plan for the whole neigh- borhood, i.e.. the parcel of land from the hotel to the Town and Country shopping center. For 13 years, the traffic in the area was minimal. Unless the area was zoned for high density, they saw no possibility ,,of a great increase in traffic even if the area developed because the street led to nowhere. It was easier for the present or in the future to use other streets. Should traffic increase to some extent, there were several solutions:. One was to work with Southern Pacific and Stanford to create a street or driveway between the hotel and Southern Pacific. Another was to develop the hotel's parking area and the Southern Pacific parcel into a joint parking and traffic, area. Stanford owned the land the City originally leased in 1915, and the land was subleased to the Holiday Inn by the City. Stanford went on record they would not agree to any public street passing through their land without their permission, and indicated no willingness to change their minds Therefore, access could probably be arranged from a prac- tical standpoint, and as tenant of the land they would cooperate in any way so traffic could go throngh their property and out to the University circle. Public traffic would then go through a private parking ict, but would be a thousand times safer because they had much less traffic. He believed staff and the Holiday Inn could arrive at a workable plan. Counciimember Menzel said Urban Lane was open - for a time after the Holiday Inn opened and people traveled , through the area to reach Urban Lane. Eventually, the access way was cat off by the Holiday Inn, and presently no traffic went _through. 7 6 3 8 9/02/86 1 Mr. Chen said the Holiday Inn had the access way open for many years, and his staff informed him the City requested the Holiday Inn construct a fence to close it. If it was Council's desire; he guaranteed the access way would be opened the next day. Councilmember Renzel said currently many parking spaces occupied the Urban Lane encroachment. She believed the City could exercise the easement and. Stanford had no say-so. There might be a time in the future when the City needed that access way, and she asked where the parking would go that currently occupied the access way. Mr. Chen said the City at one time encouraged the Holiday Inn to acquire the land between the hotel and the railroad. They dis- covered when Senator Stanford deeded the land to Southern Pacific, a clause said said if the piece of land was not being continuously used by the railroad, it would automatically revert back to Stanford. Since the land was not used for a long time, the Holiday Inn went to Stanford University Land Department and brought the fact to their attention. Stanford was delighted and immediately started negotiations to lease the land to the Holiday Inn. SP immediately put up a sign saying the land was private property and started construction to qualify they were using the land. Stanford and the Holiday Inn felt it was pointless to pur- sue the matter if SP insisted on utilizing the land. Urban Lane was there when a public duck pond and corporate yard were there. Both had since been removed and, as a result, there was hardly any traffic going to that location. The Holiday inn bought the ware- house area of almost two acres adjacent to the, property and could tear down the warehouse and develop additional parking. Secondly, the Holiday Inn could build a garage over the existing parking area. They had one of the most generous parking ratios in the area compared with other. properties. Bob Moss, 4010 C rme, said when the issue was before Council in April, the Palo Alto Civic League sent a letter (on file in the City Clerk's office) asking Council to deny the application, and the position still stood. The - proyecte was the subject of an elec- tion. During the election campaign certain statements were ',made regarding the project, and the request for an expansion went against what the people voted for. Nothing had . happened over the past 13 years to change the ,substance of _ the vote, and there was no compelling reason for Council to overcome the vote. Theexpan- sion wouldincrease both lot coverage and the . FAR above. normal. An FAR of 0.68 was more than would be allowed for other motels in the City. The Council specifically considered what an appropriate FAR should be. Staff recommended 0.75 for Motels and Council voted not to adopt that. He asked why Council would rescind its already considered stance on the issue for cme particular project. The staff recommendation to approve was predicated primarily on the estimated $220,000 in annual revenue to the City; however, 7 6 3 9 9,o2 86 nowhere in the,,estimates or discussion was the actual cost to the City for providing various services, i.e., fire, police, util- ities, etc. The net would be less than $220,000. He hoped the City would not chanine normal and reasonable procedures for planning and land use merely because of the possibility for addi- tional income --$220,000 was not worth it. Mayor Cobb declared the public hearing closed. Councilmember Sutorius asked if staff had the calculation of the FAR ,for the total project if the restaurant was deleted. Mir. Schreiber said the existing FAR was 0.52, the proposal addi- tion would bring it to slightly less than 0.60, and the modifica- tionif the restaurant was not constructed, assuming 4,200 square feet, brought the FAR to slightly more than 0.66. Councilmember Sutorius referenced the FAR ,ifferential with and without the Japanese restaurant. He understood the Holiday Inn had a design that included the restaurant and a number of appro- priate rooms and had carefully integrated the dcei;r proposal with the existing building. He appreciated how the architecture was staggered, but from his point of view, there was too much mass at the end that went toward El Camino and want extremely close to the existing sidewalk. To address' that, the project could be redesigned or the number of rooms or other facilities reduced. The Japanese restaurant represented 4,200 square feet, and a reduction might have beneficial impact on traffic, on parking, and on the appearance.. He asked how the Holiday Inn weighed the num- ber of rooms versus the addition of the restaurant. Mr. Chen replied in the original lease the City asked the Holiday Inn to build no more than 500 rooms. In 1972 it was the City's desire not to build too small a hotel because they were concerned about income. The Holiday Inn voluntarily reduced the number to 285 with the intention that the buildings wrap around the water garden to make a complete design. He designed the original hotel and the subject addition, and it was in keeping with his original concept. The Japanese restaurant would add another dimension to the cuisine offered. However, the restaurant was a desirable ele- ment net necessary in . a "do or die" situation. The hotel rooms were extremely important, because without a sufficient number of rooms, the total undertaking would not make economic sense in termer of underground parking, etc. If Council considered the restaurant an important issue and would like the Holiday Inn to consider other alternatives, they would be glad to work with City staff to come up with an acceptable solution. i Councilmember Renzel asked staff about the requirements in the lease, and the relationship between the lease and the zoning. What obligations did the City have under the leaseas opposed to the zoning. 7 6 4 0 9/02/86 City Attorney Diane Northway said Council had not contracted away its zoning powers, and they were as absolute as they would be without the lease. Council had the right to zone the property as it would any other property in the City. Mr. Schreiber said the lease provision indicated the promises` should be used to construct, etc., a first-class hotel of not less than 250 units nor more than 500 units, and a first-class restau- rant or restaurants, and cocktail lounge or lounges to be done under a Planned Community (PC) zone per the lease. MOTIO s Vice Mayor Woolley moved, seconded by Sutorius, to adopt staff recommendations supporting the zone change application on a conceptual levol and refer the application to the Architectural Review Board (APB) and Planning Commission for design review and recommendations which would be returned to Council for ultimate approval, with the following findings and conditions 1. The proposed hotel expansion will not result in signifi- cant environmental impacts, particularly in terms of additional traffic generation; 2. The site is so situated, and the uses proposed for the sits are of such characteristics, that the applica- tion of general districts or combining districts will not provide sufficient flexibility to allow the proroaed development. The proposal is an extension of an existing Planned Community (PC) District and will not result in objectionable environmental impacts, such as peak hour traffic generation, which would be allowed under per- mitted uses in adjoining commercial zoning districts; 3. Development of the sits under the provisions of the PC district will result in public benefits not otherwise attainable by application of the regulations of general districts or combining districts, in that the _ addition will result in a minimum revenue increase to the City's General Fund of $222,000, which will result in benefits to the citizens of Palo Alto. The project also mill pro- vide approximately $123,000 for City housing programs; 4. The uses permitted and the site development regulations applicable "within the district are compatible with the Palo Alto Comprehensive Plan and with existing and poten- tial uses on adjoining sites or within the general vicinity, in that the proposed hotel ,expeesiem le consis- tent with the City's desire to restrict the potential for peak hoer traffic generi tion by commercial. usss 7 6 4 1 9/02/86 MOTION CONTINUED t 5. \Delete the development of a r*.staurant= 6. Include not loss *!s« 3 'public parking spaces, and 7. Include financial contributions for the creation of a bicycle path. Ms. Northway said tha motion was for a fixed approval. There had to be some formula in terms of an amount over the maximum required parking. The language was specific enough. Vice Mayor Woolley said the item' was consistent with the Golden Triangle policy, which was important. In terms of the specific City policies, under the City-wide Land Use and Traffic Study, Council asked staff to look at a 0.75 FAR for hotel/motel use only, exclusive of restaurants. Staff made that strong recommen- dation to Council a year ago and Council turned it down. It was made fairly clear that the traffic generation, particularly in the peak evening hours, was not significant. One hundred percent occupancy of the new part added only 31 trips during the evening peak. From the standpoint of creation of new jobs, if Council eliminated the restaurant it would be still lower, and even with the restaurant . it was much lower overall than for a retail or business use. In terms of revenue, the project would generate much more impact than other retail and business uses. Therefore, it made sense that the FAR applied should be adjusted accordingly. Council had an opportunity to treat a low -intensity use --because of the PC over which Council hadtotal control-- differently from other uses in the adjacent CS zone. Council would do so by sup- porting the motion. M30 Northwa►y said in reviewing the language in the motion "finan- cial contribution for a bicycle path," she believed something more specific was needed in terms of a percentage or some kind of guideline in terms of how the amount would be established. Vice Mayor Woolley called on Mr. Chen for a suggestion to makethe language more specific. Mr. Chen believed the bicycle path was a relatively modest finan- cial commitment from the Holiday Inn. They were happy to be able to make any contribution worked out by the Holiday Inn and City staff. He suggested a number of $5,000. Mayor Cobb said as Counciiaember Bechtel pointed out the language in the staff, recommendation was that the proposal was conceptual, and he asked if Council needed to be specific at the conceptual level 7 5 4 2 9/0 2/86 Ms. Northway suggested Council be more specific either in percent- age of total cost or a certain minimum amount be established, as was done with the parking, guaranteeing a floor to whatever was given. Council's approval would require that floor at least be given. Council could leave the language loose .and open if desired. Councilmember Levy referenced the bicyie path and said he under- stood there were two elements involved: The applicants agreed to construct a bike path through or adjacent to their property, and they agreed to a financial commitment towards completion of that bike path, the goal being to reach Town & Country. Mr. Newman understood Council requested staff to study a bike path from the Southern Pacific depot to the Palo Alto High School. The Holiday Inn welcomed and encouraged the study because a number of bicycles passed through their property in the path of oncoming cars. They would be delighted to work with staff at the direction of the City Council to see about locating the bike path along Urban Lane in the area behind the current fencing. They under- stood the process would be a long one but stated their commitment to work with staff and make a financial commitment. He understood the project needed to be studied further, and they indicated•a willingness to commit to that purpose as well as the $5,000, which sum he understood would be put in a trust fund for the City's use .in the event the bike path was established. Mr. Schreiber said the bike path concept came up during the staff review leading to the report to the Planning Commission dated March 21 (on file in the City Clerk's office) in which staff indi- cated the concept needed information collected, and staff would pursue discussions with the applicant, Stanford? etc., during the processing of the zone change application. When the Planning Commission recommended denial, those discussions were put on hold pending Council resolution of the issue as to whether the City had a project or not. If the project went ahead, staff would pick up the issue immediately with the. applicant and other affected parties to come up with an equitable condition which would also yield positive benefits to the City. Councilmember Levy was generally in sympathy with the motion and found it proper to delete the restaurant and to approve the added hotel rooms. He was mindful the PC was established originally by a vote of the public a number of years previously; however, he did not believe that vote at the present time should not .be looked at anew in light of experiences since then. It was appropriate •to consider the situation to date/ to consider the impact on traffic, on employment, and on parking. As mentioned by Vice Mayor Woolley, those impacts were small. The Planning Commission hearings a1:o raised the issue of fairness, and the fact the 7.6 4 3 9/02/86 property would be raised to a 0.68 FAR and that other hotel prop- erties were limited by zoningregulations to 0.5 FAR. The fact the project was a PC, however, gave Council the opportunity and right to look at it as an individual property, and any other hotel property had the right to go to Council as a PC and to make a case that their FAR should be different from the normal zoning approved. He did not find other arguments against the property 'compelling, i.e., the traffic, visual aesthetics, and the cost to the City for added servicing of police and fire, which were mini- mal. It was appropriate to exclude the restaurant because that would add some traffic during the rush hours, and he saw no com- pelling public benefit in that. The approval was conceptual and would return to the Planning Commission and to Council for ulti- mate approval. The added parking and the bike path were both good things he would like to see accomplished. He looked Upon 30 spaces as an absolute minimum and hoped to see 40 or more spaces eventually. He assumed there would be an easy pedestrian passage from those spaces across the tracks and over to town. Working in Downtown Palo Alto, he knew it was cumbersome to get, e.g., from the Downtown area to Town and Country, and a bike path would be a significant public benefit. It might be cumbersome to get the approval of Southern Pacific. He urged applicants and City staff to use all their dexterity and pressure so the bike path might be completed. Councilmember Klein agreed with most of the comments of Vice Mayor Woolley, Councilmembers Levy and Sutor.iue and intended to support the motion. He recalled the facts of the ballot measure of 15 years ago differently. He asked if it was correct that Council` passed a PC and the voters obtained enough signatures to put a measure on the ballot to overturn what Council had done. Ms. Northway said that was correct. Councilmember Klein believed that made things less embedded in concrete than several people spoke to that evening. The voters said 'no" to the people who wished to overturn Council's decision, and the vote should be interpreted that the voters decided to endorse the Council's judgment in the matter. It meant the Council in 1986 was free to review the PC in the same manner as it would review any other PC which the Council of 1972 adopted. Con- ditions had changed in 14 years, and Council had to shift to meet changing conditions in a particular industry. The hotel industry had a particular public benefit as the public used a hotel to a great extent. He believed the Holiday Inn provided a service to the community in addition to being a commercial enterprise, and it wai in Council's interest to maintain the competitive position of that hotel. For those reasons, he found there was a public bene- fit and would support the motion. 7 6 4 4 9/02/86 Councilmember Fletcher said the ballot measure did promise spe- cific percentages of open space, landscaping, building coverage, etc., and those were used in the ballot arguments, at the time. When she was on the Bicycle Advisory Committee many years ago, City staff explained a long --range concept of linking Park Boulevard, which basically served as a bicycle boulevard, with the bike path going through El Camino Park out to the other side of the City. There was a suggestion to widen the existing bridge over Embarcadero to link up those segments. At that time, the Palo Alto High School PTA was eager to get pedestrian access over the Embarcadero Road segment because students ran across at great hazard. If the path was completed, the bridge would be the expen- sive link. She referenced the May 2, 1986 Downtown Study document (on file in the City Clerk's office) which said the sanitary sewer system serving the Downtown primary study area might be overtaxed and asked if the hotel linked up with the same sewer system seg- ment. Mr. Schreiber could not attest to what segment of the sanitary sewer system the development linked up to, but the comments on the project from the Utilities, Water, Gas, and Sewer Divisions were it presented no problems. The issue could be pursued further in the subsequent review if Council approved the concep- tual stage. Councilmember Fletcher .said it might be too late to take into account at that point. She had not seen reference to the refuse generation from the hotel and asked if that should be addressed in the environmental document. Mr. Schreiber said the issue was not raised thus far but would be addressed. Councilmember Fletcher saw the two items as being potential prob- lems, but she had not decided 100 percent how to vote on the issue. Councilmember Bechtel had not seen as much information on parking as on traffic generation. Several letters attached to the staff report (on file in the City Clerk's office) described the need for meeting rooms and conference rooms as well as hotel space, and she asked if any additional conference areas were planned in the addi- tion. Mr. Schreiber said the addition was strictly rooms and suits. Councilmember Bechtel said parking always seemed to be a problem whenever she went to a meeting at the Holiday Inn, and yet the staff report indicated there was a surplus with the 69 car parking garage of 47 parking spaces. She asked if that figure .,was reached strictly through: the City's formula. 7 6 4.5 9/02/86 Mr. Schreiber said the figure was arrived at through the formula in the Zoning Ordinance. Councilmember Bechtel asked if there had ever been a count to determine_ if there were spaces, particularly when there was a meeting or event. Mr. Schreiber was not aware of one, but was sure the issue would also be raised in the discussion of public parking in terms of the total demand on the site. Councilmember Bechtel clarified the process was., if the motion passed it then returned to the Planning Commission and the ARB, so there was the potential the numbers might be changed. Mr. Schreiber said that was correct, it was the conceptual stage of the PC zone process. Numbers certainly could and often did change in developing the detailed plans and investigating the issues raised in the current portion of the process. Councilmember Renzel said as a City they had wrestled with tough growth issues which in every instance had resulted in a downzoning or rezoning to less intense use in order to take care of some of the perceived problems. Nevertheless, a great deal of growth would occur, and Council did not know all the impacts of the growth until it actually happened. The issue in question was a PC zone with a proscribed limit. Council was being asked to increase the limit, and the principal reason from staff seemed to be that the City was to get a lot of money out of it, and she found that terribly offensive. It was a bad way to do land use planning and had not proven out in the past in many communities, including their own. The idea that Council might decide ultimately to allow. hotels to have a 0.75 FAR might be fine, but the Holiday Inn was not exclusively a hotel use. When the PC was referended, it did not include the 5,000 square feet of conference rooms. Those were defined as storage space in the original PC and questions were asked. The space was converted to conference rooms and an ex post facto PC granted to legitimize the use. Likewise, Uroan Lane was shown outside the PC in the election literature but incorporated when ` the project was built. There was also a PC amendment in 1983 to add more wedding, restaurant space, etc., all of which encroached on the so -Called . campus -Like atmosphere promised to the voters back in the referendum. It was not clear the voters would have upheld the Council decision if they had foreseen the changes that took place. Nobody could deny there would be traffic increases due to the project, albeit minor. Council was voluntary in an era of scaling back everywhere else in town and joining in the Golden Triangle which was scaling back on a region -wide basis, and expansion made, no sense, particularly when they were not looking at what alternatives could be built on the site. The site had a PC zone, and in the absence of Council changing that zone 7 6 4 6 9/02/86 nothing more could be built. The double -deck garage underground would severely impact the root structure of the trees which were the last of the campus -like atmosphere promised the voters. The intersection was messy at present, and it would not take a lot of increased traffic to be a bigger- problem. Council faced the Stanford- Master Plan which showed an enormous amount of traffic, -a lot of which had to pass through the same intersection. MOTION PASSED by as vote of 7"2, Fletcher, Emma voting no.' 4. RE UEST OF COUNCILMEMBER FLETCHER RE CITY USE OF RECYCIAID PAPER (Continued from 8/25/86 ENV 8) Assistant City Manager June Fleming said staff replied to the letter from the War on Waste Committee (on file in the City Clerk's office) after receiving Councilmember Fletcher's communi- cation. The City opened bids that week for paper stock, and 66 percent would be recycled paper. Councilmember Fletcher asked why 100 percent was not recycled. Ms. Fleming said a small portion of the paper the City bid was colored paper stock, . which could not be obtained in recycled paper. The -City also asked for a. small amount of paper to use on the Kodak copier which would not take any currently -produced recycled paper. Palo Alto was committed to recycled paper and requested it in each bid. Councilmember Fletcher suggested the City buy a larger quantity of recycling paper by linking up with other jurisdictions. - Ms. Fleming was not aware the City had pursued linking up with other jurisdictions but could look into it as other cities made the commitment to recycled paper. In staff's estimation, the City was advanced in comparison to other cities. Councilmember Fletcher said it was San Jose's Council policy to buy recycled paper. NOTION; Councilnenber Fletcher moved, seconde4 by Meisel, to adopt a City policy to purchase recycled paper when the price _dif- ferential is no greater than 6 percent, Councilmember Fletcher was struck by an editorial in the Mercury on August 22, 1986, saying Americans used over 200 pounds of paper each last year. Councilmember Bechtel believed the City already had a policy for urging the staff to use recycled paper. Staff showed a commit- ment to use recycled paper to the extent possible because of the limitations pointed out by Ms. Fleeing. :she was concerned about the 6 -percent differential. MOTION FAILED by a vote of 3-61 R.Asel, Fletcher, Levy voting •aye." 5. URGENCY ORDINANCE IMPOSING A MORATORIUM ON DEVELOPMENT WITHIN THE CITY OF PALO ALTO FOR USES NOT IN CONFORMANCE WITH THE FLOOR AREA RATIO POLICY FOR THE GOLDEN TRIANGLE TASK FORCE Continued ra 8 25/86) (PRE 3) (CMR:443:6) 6. GOLDEN TRIANGLE - iGREEMENT WITH SANTA CLARA COUNTY MANUFACTURING GROUP (Continued from 8/25/86) (PRE 3) CMR:445:6) Mayor Cobb said comments from the public on Items 5 and 6 would be taken together. Council would vote on the items separately. Darr McGanne, III, 4100 Campana Drive, also spoke on behalf of Dick Madigan and said they represented California Pacific Commercial Corporation who presently owned, leased, and land -leased a number of parcels within the Ford Aerospace Center along Fabian Way. The majority of the buildings were leased to Ford and presently pro- vided floor area ratios (FARs) in the range of 28.7 to 43.2 per- cent. Until recently the area enjoyed a 1:1 building ratio which was reduced to 50 percent coverage earlier in the year. In origi- nally constructing the buildings, however, they felt it was viable to create and maintain en attractive campus setting and also to provide ample parking. Thus, none of the buildings approached the limits. They were now concerned that the further restriction to 35 percent would preclude rebuilding, renovating, or improving the property. Their intention to upgrade the buildings might be com- promised by the associated economic costs of reduced rental income and depressed property values. Given the existing lease contracts providing tenants with extended terms, he asked if the possible destruction by fire would prevent the rebuilding of the same con- tracted base., if in excess of 35 percent, or if a grandfather clause was being considered. Palo Alto was unique and did not possess the same potential and capacity for further development addressed by the Task Force with respect to the Golden Triangle cities. The tenancy of Ford, the site and attractiveness of their campus setting continued to provide significant benefits to the City. Cal Pacific therefore suggested the distinctive situation warranted special consideration, and Council not imprudently further restrict the operation of the highly --productive complex. He was particularly hopeful Council would appreciate the economic consequences when applying the prohibitive standard and that loca- tion, environment, and the project's overall merits be con- sidered. Mayor Cobb noted Council had read the correspondence provided. Robert Bernhardt, Facilities Manager, Ford Aerospace, Fabian Way, said his comments were in addition to the letter to Council dated 7 6 4 8 9/02/86 August 25, 1986 ton file in the City Clerk's office). Ford occu- pied 27 buildings in the Palo Alto area and had a pressing requirement to consolidate its engineering force. The new engi- neering facility was to be located on a 4.65 acre vacant lot Ford controlled on Fabian Way near East Meadow Drive. Based on the new zoning ordinance passed by Council earlier in the year, Ford com- pleted a conceptual design for the new facility. It was deter- mined a minimum of 90,000 square feet was required to consolidate the engineering activities and it would be more advantageous to own rather than lease the property. They obtained approval from the parent corporation to acquire, the vacant lot and it became Ford property on May 9, 1986. They also obtained funding for the facilities' preliminary and final design in 1986, and for facility contruction in 1987. They retained the services of an architect/engineering firm to complete the design and permitting packages by November, 1986. The facility was only about 90,000 square feet or a .44 FAR, even though almost 102,000 square feet could be built on the site within th.e current 0.5 F.R. The asso- ciated mitigative measures for that size building on the Fabian Way site were all identified and analyzed in detail in the City's Environmental Impact Report for the San Antonio area issued in January, 1986. Ford asked co be exempted from further downzoning, primarily for four reasons: 1) A large corporaton such `as theirs could not act any faster than they had following the new zoning ordinance passed only six and one-half months ago; 2) Ford acted in good faith in supporting the City's objective to reduce further develoments by planning a facility only as big as required, not as big as allowed; 3) the City long knew. of Ford's plans for a 100,000 square --foot facility --in fact, the facility was made an integral part of the City's recent environmental report; and 4) by having the environmental impacts and associated mitigative measure identified, the new Ford facility had the most important aspects of the City's approval process already covered. Ford requested Council to approve the exemption of Ford's new engineering facil- ity on Fabian Way from the urgency ordinance, or to take any similar action which allowed approval of the 90,000 square foot building when permitting packages were submitted to the City in November, 198.6. . Herb Borock, 2731 Byron Street, urged Council to remove the Geng Road parcel from the list of exemptions from the FAR limit. The voters authorized the City to negotiate an exchange but did not agree to an exchange nor to a project with a guaranteed FAR. The voters also authorized an equal --value exchange if negotiations were successful. It was not relevant that the Golden Triangle FAR policy exempted projects that resulted from a local election because the voters did not approve a project and an equal -value exchange would result in an FAR more restrictive, .than 0.35:1. In staff report CMR:443;6, page 4, Exhibit 1, the M zone was shown as including the Geng Road parcel. The site wiz. not zoned LM and current zoning would not permit the office building contemplated by the developer who wanted to acquire the site. The environ- mental assessment at the end of the staff report, page 2, stated the Geng Road parcel would be involved in a land transfer of 0.4:1 FAR and the transfer was approved for development by the voters. The voters did not approve a transfer, and the measure adopted by the voters required that all development processes be followed including environmental: review under the California Environmental Quality Act. When Council voted on the proposed ordinance, it was voting to accept the environmental assessment. He believed Council should change the environmental assessment to reflect what the voters actually approved and omit any language that assumed a result that had not yet occurred. Bob Moss, 4010 Orme, asked Council not to adopt the emergency moratorium and not appropriate funds as requested, Palo Alto should not take precipitative actions to solve Santa •Clare's and San Jose's problems. Palo Alto was completing an extensive study of the impacts of traffic and FAR on its community, which was appropriate and something Palo Alto could do something about specifically. They already went through a number of studies on various areas. In discussing the FAR appropriate to the CS, CN, and OR. zones, a previous staff report said that a 0.5 FAR still allowed a lot'of new development to occur but was a significant reduction from the present development potential. Lower FARs of 0.3 or 0.4 reduced the risk but also might over restrict. The ordinance was silent on the issue of what would happen to an existing project with a 0.4 FAR of more than 50 percent if the building was destroyed. In regard to the statement that there was no requirement for a full EIR, there was a negative declaration, that had never gone beyfore the Planning Commission and he doubted the negative declaration finding would stand up. Council was asked to enter into an agreement which would abdicate the City's rights and responsibilities to control and manage the zoning and land use in the City to an organization which was neither appointed, elected, nor accountable. Council ryas asked to appro- priate $40,000 f er a study the parameters of which Palo Alto did not define, and they had nothing to say about the consultant selection. Council was being asked to instruct staff to review the plan and find out what properties could be rezoned residen- tial. He Asked what areas they could be considering rezoning that had not been considered and rejected before. Council was being asked to put $55,000 into the pot for a Traffic Demand Study. He believed what the Golden Triangle really wanted from Palo Alto was money to solve . the problems of Santa Clara and San Jose. Council was being asked to commit staff resources to the extent that Council would not be adopting and following its. own recommenda- tions for traffic studies. Council was being asked to establish a moratorium' which would not apply to bank branches, hospitals, hotels, restaurant facilities, and retail uses. Some of those uses were among the highest traffic generators. The exceptions would allow significant traffic growth. The deng Road project was never adopted as any specific FAR and exempting the project was inappropriate. If Council wanted to solve the problem of excess traffic in the Golden Triangle, the best way was to require the Santa Clara City Council and Santa Clara staff to drive along 101, 237, 280, and 85 every day from 6:00 a.m. to 6:00 p.m. John Rd Farrar, 261 Hamilton Avenue, President: of the Far Western Land Investment Company, also owned three buildings along Fabian Way and an undeveloped parcel on the corner of Charleston and Fabian Road. They heard a hearing would be held to consider the urgency ordinance imposing a moratorium on development of all the properties in Palo Alto only, last Monday, and he asked why the affected fected people were not notified of the hearing, and why the consideration for the adoption of the Golden Triangle plan be made without any impact or discussions from the Palo Alto property owners whose properties were subject to further restrictions. Council would recall the ordinance was changed reducing the FAR from 1:1 to 0.50 only six months ago. Prior to that, they experi- enced a moratorium on their property for the past two years which created hardship and frustration. Now, Council was considering anethc year's moratorium on development of their property unless it conformed to the Golden Triangle plan minimum property require- ments which further reduced the property from 50 percent coverage to 35 percent coverage. Palo Alto was unique in the Golden Triangle. There was a limited amount of vacant :And undeveloped land area compared to the other cities. Palo Alto was almost fully developed and had done something about its own land usage. He asked when the Lurther restriction of properties would cease. Council would be creating a hardship to the majority of the owners of industrial buildings in Palo .Alto by passing the ordinance. Most of the buildings along Fabian Way would be classified as non- conforming. They would be unable to remodel without being in violation' of the ordinance. The moratorium would create a finan- cial hardship. When they formed the Fabian Way Assessment District in the 1950s, they felt Palo Alto would protect the rights and interests of their investments in Palo .Alto. They acted in good faith and created a beautiful. model industrial park. Slowly, but surely all their rights of ownership were being eroded away along with future security from their inveatment. They hoped they could rely on the City of Palo Alto to protect their rights as property owner.;s. The ordinance was too important an iasue to be placed on an agenda as an urgency ordinance. There was no guarantee the .ordinance was only for one year. Palo Alto should look to itself for leadership. Dick Madigan, California Pacific Commercial Corporation (CPCC), said CPCC owned seven buildings and .the land under five others in the Fabian Way area. Ford was needed in . Palo Alto, but it was entering into lease negotiations in other areas. He urged Council retain the .50 floor area ratio (FAR) for the building to be con- structed on Fabian Way. CPCC wanted to replace some of its 7 6 5 1 9/02/86 1 buildings at the presently existing FAR. It would think twice about replacing buildings if it could not be done at the same FAR. CPCC also wanted the ability to combine two contiguous properties. and FARs and buildone building on the two lots which would be a total of the two FARs. Councilmember Renzel referred to page 9 of Exhibit "A," attached to the Agreement, Task 3.1, ."Review Existing Agency CIP's." She believed the purpose of the sectionwas to look at transportation projects planned for each community and to make a consolidated model based on those plans. She asked if any of the tasks would require the City of Palo Alto to build an "Embarcadero Freeway" if it was found to be a necessary project to improve traffic flow and circulation, which the City itself had not contemplated. Mr. Schreiber said no. Councilmember Renzel clarified the only items identified for Task 3.1 were already adopted by the City Council. in the Capital Improvement Program (CIP). Mr. Schreiber said that was correct because of Palo Alto's CIP, but Transportation 2000 and the County might look at other improvements. Councilmember Renzel referred to Mr. Borock's letter and his ref- erence to a .4 FAR. She asked if Mr. Borock was correct that the nearby zoning which permitted zoning only.,,, had a .3 FAR. Mr. Schreiber said Mr. Borock was correct the nearby zoning was LM -3, which had A FAR of .3:1. The Geng Road parcel was included in the July discussions because of negotiations of land, the transfer 'agreement between the City and Mr. Peery. The document was scheduled for the City Council agenda of September 22, 1986. 1t one point in the negotiations, the size of -tha structure desired by Mr. Peery and the amount of land discussed resulted in a FAR of greater than .35, .and as it was now structured, the agreement contemplated a FAR of .3 --the LM -3 zone. Staff had not wanted to chance inadvertently undermining the land swap -by not including the subject parcel in the discussions in July, which ha►d since carried on in the Golden Triangle discussions. Councilmember Renzel . clarified Mr. Peery was holding outs for a 49,000 square -foot building regardless of the acreage. The appraisals brought the acreage in equal and a .3 FAR would apply. Assistant City Manager June Fleming did not believe staff could respond because not everyone was a party to the negotiations. 7 6 5 2 9/02/86 MOTION* Councilmember Klein moved, seconded by Levy„ approval of the staff r•cowoendatioR to adopt the moratorium ordinance on the issuance of land use approvals or building permits _ for uses not in conformance with the floor area ratio policy of the Golden Triangle Task Force, finding that the ordinance will not have a negative environmental impact; end doclaring an emergency. ORDINANCE 3705 entitled "ORDINANCE of THE COUNCIL OF THE CItY Or PALO ALTO IMPOSING A MORATORIUM ON THE ISSUING OF LAND USE APPROVALS OR BUILDING PERMITS FOR USES NOT IN CONFORMANCE WITH THE FLOOR AMA RATIO. POLICY OF THE GOLDEN TRIANGLE TASK FORCE AND DECLARING AN EMERGENCY" Cvuncilmember Klein sympathised with the property owners, but emphasized the emergency and the Task Force were. temporary. It was intended to expire in late May and superseded by whatever resulted from Phase II of the Golden Triangle Task Force: The Task Force deliberately put itself on a tight timetable in order to expect actions. For those skeptical about government pro- ceeding on schedule, the Golden Triangle Task Force did keep its Phase I schedule. No one associated with the Task Force expected the .35 FAR to be the final solution. It was an expedient, crude tool while more sophisticated tools were developed to operate in a more site -specific manner in recognition of a variety of other considerations. The exception policy in Mr. Zaner's memo of August 28, 1986 was on the right track. Exceptions were a concern to all delegates to the Golden Triangle Task Force. To date, no one requested an exception, and he did not want Palo Alto to be the first to break out. The key to the concept, which made it worth Palo Alto's time and money, was Palo Alto was not an island. What happened in San Jose and Santa Clara was important and impacted the community. He urged Council support of the motion, and to work towards an appropriate exception policy ,which was in entire Task Force's interests. He hoped the process would result in reasonable limits on growth for the entire area AMEWDKE$Tt Comae ilmsbber Rsnseel moved, seconded by Fletcher, to delete references to an exception for Gong Road. Councilmember Klein believed it was inappropriate to enter into a discussion of what would be done on the land swap. It might be that a .35 FAR was where the City wanted to end up when the proj- ect was reviewed, but the exception was negotiated going into the Task Force and it was there specifically. The Task Force could care less what the City did on the exception --it was more a matter of what happened on Palo Alto's political level. The City should maintain its flexibility and when thelandswap and Peery's pro- posed building were reviewed, it would be done Oh its merits and not in a "back -dean manner., 7 6 5 .3 9/02/86 1 1 1 1 Councilmember Fletcher was troubled by predetermining the FAR which was what the City basically did i f i t endorsed the exception from the .35 FAR. Prior to determining the specifics of a par- ticular rezoning, the City always went through the Planning Commission to develop the analysis for the Environmental Impact Report. to. Councilmember Bechtel said while she agreed with Councilmembers Fletcher and Renzel in terms of not predetermining the FAR and while she shared their opposition to the land swap, it was already negotiated and by allowing the exception to remain, she did not believe the City was committed. The City should allow the project to proceed through normal channels. Councilmember Renzel understood the exemption was not necessary as the swap was currently structured. She believed the exemption implied a higher FAR might be permitted than was generally per- mitted in similar zoning districts. It was good policy to delete something with such an implication, particularly since it was not an issue with respect to the exchange. Mayor Cobb associated himself with Councilmember Klein, and believed Mr. Sorock's letter and the amendment were nothing more than an attempt to short-circuit the will of the voters. AMENDMENT FAILED by a vote of 2-7, Fletcher, Renxel voting "aye.. Councilmember Renzel would support the motion. She did not believe the City was buying "a_ pig in a poke,'" nor that Palo Alto was exemplary in its land use planning. It took a long time to do what needed to be done many years ago, and what was done still permitted substantial growth. As a town with two jobs per every housing unit, Palo Alto was part of the problem and needed to be part of the solution. A consolidated look at each community's plans for transportation and development would be instructive. It was clear the greater community had an aberrant marketplace where buildings were constructed to stand vacant. The Cushman -Wakefield studies of vacant space received each month showed numbers as high as 50 percent. The study would help every community to sort out what was being done to the environment, the transportation system, and the way of life. Councilmember Bechtel sympathized with the property owners, but Palo Alto was affected by ghat happened in the surrounding com- munities and needed to be a part of the regional planning. She supported the motion, but looked forward to requesting future exemptions if necessary when the Ford Aerospace project was' further along. Palo Alto made a difference by being a part of the Golden Triangle Task Force. It was a major commitmint of staff and resources, but it was important. 7 6 5 4 9/02/86 As corrected 10/6/86 Councilmember Levy endorsed the Golden Triangle Task Force. He was concerned about what happened when a building was destroyed by an act of God, and whether a grandfather clause was needed to rebuild the destroyed structure to the FAR and density existing before the destruction. Ms. Northway said in the City's history of moratoria, there was never a grandfather clause for such destruction. If the situation arose, staff would return with an emergency amendment. A grand- father clause was unnecessary. Councilmember Patitucci asked what was done in previous moratoria situations with respect to rehabilitations within the same devel- opment envelope. Ms. Northway said rehabilitations were subject to the .35 FAR. Previous moratoria, with the exception of the Downtown moratorium, had an exception procedure iri the ordinance, but she did not believe there was any specific provisions for rehabilitations. Councilmember Patitucci would be more concerned if the moratorium were iit+ended to run substantially longer, but since the mora- torium ended in May, 1987, the issue probably would not be a sig- nificant problem. If such a restriction continued for a long period of time or was extended, he wanted to look at specific language for the points raised by Councilmember Levy. Ms. Northway said if the moratorium was extended for an additional time period, staff would return with an amendment to the ordinance at which time other types of amendments would be included pursuant to Council desires. Before any exceptions were made, the objec- tive was to return to the Golden Triangle Task Force and discuss the issue in general as part of the larger issue for everyone at which time a decision would be made for Palo Alto. Councilmember Sutorius agreed with the concerns expressed by Councilmentber,s Patitucci and Levy. He echoed comments of positive support for the motion and encouraged Cupertino and Fremont to take the same steps. NOTION PASSED unanimously. NOTION* Councilmember Patitucci moved, secomded by Bechtel, to adopt the following police statements 1. Agree to review requests for exceptions as a case -by -case basis looking at the merits of each request withstaff to develop criteria for ,merits* Review requests for a ceptioas by January 1, 19*7: sad 7 6 5,5 9/02/86 MOTION CONTINUED 3. Direct the City's delegate to the Golden Trianals Ta, F'otce to raise the ise«a and seek establishment of an exception policy. Councilmember Renzel -clarified that while it was a Council policy statement, it was a request of staff to return wit'' a framework in which it could .L be done. She believed the motio.i was reasonable and reserved judgments until she saw the standards. Councilmember Klein c1ai: i .eu cne exception policy would be con- sistent with the policy of the Golden Triangle Task Force. The expectation was that no city would grant any exceptions on its own even though such power existed without going through the Golden Triangle. Record reflects confirmation by the Council. MOTION PASSED unanimously. MOTION: Cu ancilrember Klein roved, seconded by Bechtel, approval of the agreement. AGREEMENT BETWEEN THE CITY OF PALO ALTO AND THE SANTA CLARA MANUFACTURING GROUP FOR ADMINISTERING CONTRACT TO DEVELOP GOLDEN TRIANGLE MODELING PROCESS, CAPITAL IMPROVEMENT PROGRAM, LOS -FAR POLICY AND FOR CONTRACTING FOR PROJECT SUPPORT Councilmember Fletcher asked whether the $40,000 was for the con- sulting contract. Ms. N :rthRar maid yes. MOTION PASSED unanimously. MOTION* Councilmember Klein moved, •seconded by Levy, approval cf thebudget amendment ordinance. ORDINANCE 3704 entitled *ORDINANCE OF THE COUNCIL OF THE CITY OF PALO ALTO AgunnI$G THE BUDGET FOR THE FISCAL TEAR I3$S-117 TO PROVIDE AN APPROPRIATION FOR PALO ALTO PARTICIPATION IN TOE GOLDEN TRIANGLE TASK FORCE" MOTION PASSED unanimously. 7 6 5.6 9/02/86 7. AMENDMENTS TO THE BELOW -MARKET -RATE (BMR) RENTAL GUIDELINES \(PLA 2-6) (CMR: 454 :6) Councilmember Levy could not reconcile the 30 percent guideline for establishing rents. For example, a two -bedroom unit being rented to an individual with four occupants, 80 percent of the median income was $31,350. Thirty percent of that figure was $866 per month, and he did not see how the $866 was reconciled with the $625 considered to be the fair market rent and asked whether the fair market rent was the same as the BMR rent. Planning Administrator Toby Kramer said the 30 percent of house- holds adjusted income figure was contained in the old rental guidelines. The new recommended -guidelines would have fair market rents established by .the Department of Housing and Urban Development (HUD) which were not based on 30 percent of 80 percent of the household's income. The fair market rent was a number which HUD came up with annually by taking surveys of new construc- tion and existing apartments and arriving at a fair market rent. The figures represented the maximum rents allowed to be charged to a tenant under the Section 8 program. The number was typically used in other forms and was the one staff wanted to adopt as part of the BKR program. Councilmember Levy clarified the fair market rent was the. fair market for someone at 80 percent of the median income. Ms. Kramer said fair market rent was a number used by HUD and a term HUD used for its Section 8 Program. The Section 8 Program and Section 8 income was stated a: $27,500. In Santa Clara County, the Section 8 income was only 70 percent of the median household income versus 80 percent of the rest of the nation.. An artificial adjustment was made to Santa Clara County wherein the median income was really at 70 percent for the Section 8 grogram. Under .the new guidelines, staff proposed to use the fair market rent, which was HUD's number, and use the figure of 80 percent of median as the maximum income for a family to qualify for the BMR program. Councilmember Renxel gathered that first amendment to use the fair market rent rather. than the 30 percent of income guideline was because one of the major problems was that "excess rents" had to be turned over to the Housing Reserve Fund. She asked. why any landlord would raise the rent higher than the fair market • rent. Ms. Kramer said the guidelines presently read the maximum rent obtainable by the landlord was the fair market. rent. If a tenant was a Section 8 certificate holder, they paid 30 percent of their income and the difference was made up by the federal government. If they did not have a Section 8 certificate, the guidelines read that a tenant would pay no more than 30 percent of their income. 7.6 5 7 9/02/86 In a sense, they might pay less than the fair market rent, but any more than the fair market rent would go to the Housing Reserve Fund. Such a calculation would be done individually depending on a person's income and would be recertified annually, The compli- cations seemedto be more than the amount of units the City would get out of the: program. Many developers had logistical. problems and staff decided it would be simpler overall to go to a straight fixed fair market rent so a landlord knew what he would get and give a little more latitude in the income to qualify for the pro- gram.. Councilmember Renzel recognized the administrative simplicity of the new proposal, but was concerned people without the Section 8 vouchers might end up paying a higher portion of their income, or that the BMRs would only go to people at the high end of the qualifying range. If the fair market rents were established by the rents of new construction and going market rents and many other thin=s, it might not long remain affordable. Palo Alto Housing Corporation (PAHC) Treasurer Marilyn Zatz.said it was a Below -Market --Rate program, but did not always reach out to the very lowest income as_ the subsidized projects would. With the fair market rents, the PAHC did better than it did with the first set of guidelines where it went from 80 to 120 percent. Councilmember Sutorius said the guidelines introduced a one-year lease offer and referenced Chapter 9.68 of the Palo Alto Municipal Code. Eight definitions were given of units or situations where Chapter 9.68 did not apply and two were germaine to such housing because they referred to the City of Palo Alto and other govern- ment:agencies. He clarified the way the _amended BMR guidelines introduced the one-year lease and the way Chapter 9.68 was worded did not cause any conflict. If the lease process was determined to be applicable and included in the guidelines, he, queried whether someone who initially qualified at an income level of 80 percent oe less than the median, had their income increased to 90 percent of the median during the course of the lease, but when the lease ended under the City's ordinance and if mutally agreed upon, they could renew the lease. He was concerned the program which set an income level as 80 percent of median as the entry opportu- nity, and someone could earn close to the maximum for an extended. period of tie and still _ benefit from the program. Ms. Kramer said there was a lot of discussion about whether there should be any increase in the rent, whether to make another unit available in lieu of the unit they were in, and when to increase the rent because the difference between the fair market rent, the AMR rent and the actual rent paid by other tenants in the project could be almost double. The PAHC did not want to increase the rent too soon because a family )ust going over the 80 percent level would be suddenly subject to twice as much rent in some 7 6 5 8. 9/02/86 cases: Going as high as 120 percent leeway seemed like too much so 100 percent was the compromise. Once the rent went over that figure, the person was charged the full amount and another_ unit would have to be available for the BMR family. Councilmember Levy did not understand how the rental figure was determined. If an individual was of unusually low income, they would pay something below the fair market rate. The last sentence on page 1 of the staff report (CMR:454:6) read, "The landlord can retain only the amount of the rent, up to the current fair market rents set by HUD. As a family's income goes up, so would their rent, but the excess would be paid into the City of Palo Alto's Housing Reserve Fund." He asked on what basis the rent went up, i.e., did the rent stay the fair market rent until the individual made over the median income and then suddenly it was changed to whatever the market would bear. Ms. Kramer clarified Councilmember Levy referred to the existing version. Under the amended version, the BMR rent would be as shown on page 1 of the amended version, Item 1-2. MOTION TO CQIITIML1E: Coeicileember Levy trued, seconder by Woolley* to continue the item to September S, 19$i, City Council meeting. l IO* PASSSO by a vote of 3-4* !teasel* Patitueci P Sutotius, Bechtel. voting °no. " ADJOURNMENT Council adjourned to a Closed Session re Personnel at 10:30 p.m. FINAL ADJOURNMENT AT 12:20 a.m. ATTEST: City Clerk APPROVED Mayor, 7 6 5 g 9/02/86