Loading...
HomeMy WebLinkAbout1983-04-04 City Council Summary MinutesCITY cOUNCIL M1NUT€s Regular Meeting Monday, April 4, 1983 CITY or- M[o ALTO ITEM PAGE Oral Communications 3 1 0 5 Minutes of January 10, 1983 3 1 0 6 Minutes of January 17, 1983 3 1 0 6 Item #1, .Resolution pf Appreciation to 3 1 0 6 Helen Tao Item #2, Resolution of Appreciation to 3 1 0 6 Agnes C. Robinson Consent Calendar - Referral 3 1 0 7 Item #3, Utilities Rules and Regulations 3 1 0 7 Revised - Referral to Finance and Public Works Committee Consent Calendar - Action Item #5, Resolution re California Resource Rally Item #6, Ordinance Authorizing Northern California Power Agency to Issue Bonds, Notes and Refunding Bonds (2nd Reading) Item #7, Refuse Curbside Collection, of Recyciables and Rubbish (2nd Reading) Item #8, Contract for Administration of Self-Insur d Workers' Compensation Program Item #9, , ul ti -Fanny Rental Mortgage Revenue, Bond Program Approval to'C,00perative Agreement Agenda Changes, Additions and Deletions Item'#9-A, Approval of Housing Assistance Plan for Community -Development Block -Grant Program Item 111:, ---Parking Lot_Q'Air Rights -:Project - Resolution re Assessment Distinct Change and Modification Procedure Item 012, Mortgage Air Rights Project Revenue Bond' Program Lot Q Item #12-B, Housing Development on the Terman Middle Sc'Oo1 Site - Referral of Comprehensive,. Plan and "Zoning -Changes - and Parcel Map to the Planning ° Commission Adjournment to Executive Sessi Final Adjournment 3 1 0 7 3 1 0 7 3 1 0.8 3 1 0 8 3 1 0 8 3 1 0 8 3 1 0 8 3 1 0 8 3 1 1 0 3 1 0 4 4/4/83 Regular Meeting Monday, April 4, 1983 The City Council of the City of Palo Alto met on this date in the Council Chambers at City Hal l , 250 Hamilton Avenue, at 7:42 p.m. PRESENT: Bechtel, Cobb, Eyerly, Fazzino (arrived at 8:00 p.m.), Fletcher, Klein, Levy, Renzel, Witherspoon (arrived at 7.:42 p.m. ) ORAL COMMUNICATIONS 1. Lucille Gold, 377 Creekside Drive, expressed her gratitude and pleasure that the Council saw fit to dignify and acknowledge the importance and significance of a nuclear threat which faces the whole world. That acknowledgment to the month of April not only provided a month of thought and planning pos- sible for the citizens, but also provided a memorable and a moving Easter service. Mayor Bechtel thanked Ms. Gold and everyone who organized the beautiful Easter service. The resolution, which the Council passed on February 7, 1983, declaring April as Nuclear War Preven- tion Month, stated that the City Council of Palo Alto recognized that all out nuclear war would bring an end to civilization as presently known, and that all citizens of a democracy should be amply informed in order to properly influence decisions which af- fected their lives. In the times demand, local citizens came to- gether to share and exchange ideas and knowledge with the communi- ty at large. Both the United States and the USSR had nuclear ar- senals capable of devastating the world and prevention of nuclear war required a bilateral approach involving both superpowers. Therefore, the City Council designated Apri i , 1983 a Nuclear War Prevention Month and encouraged all citizens and organizations to participate in educational programs which would ultimately contri- bute to a world where conflict was resolved peacefully, a world beyond violence, The Council urged local citizens who participa- ted in nuclear war prevention month to make a major part of their activities the a arch for creative and practical ways to reach out to their counterparts in the communities in the USSR to encourage and develop corresponding efforts in that country. That resolu- tion was introduced and passed on February 7, 1983. 2. Ralph Cahn, 500 N. California Avenue, said he was Involved in planning the activities, including the religious services held yesterday and the educational activities to be held during the month ' of April. He thanked the Council for passing the reso- lution which declared the Month of April as Nuclear War Pre- vention Month, under which banner the citizens of Palo Alto were provided the rare privilege of coming together to take part in the varied activities and to educate themselves to do those things set forth :in the resolution. He extended an in- vitation to everyone to attend one or more of the. adti vi ti es listed in last week's Palo Alto Weekly. A number of outstand- ing speakers and films were planned, and it was hoped that everyone would have an opportunity to attend one or more of those events. 3. James Little, 930 Roble Ridge, said that the process by which the Month of April was designated as Nuclear Oar Prevention Month was unique it that, 25 or 30 organizati ns formed a coalition to organize the 'activities, coordinate, with each other, and pool resources to ,have- the,ad which appeared: .in the Palo Alto Weekly. That type of cooperation throughout the world, where people _wi th ,many disparate ideas and agendas came together, could: make things . happen for the good of all 3 1.0 5 4/04/83 Mayor Bechtel announced the need for an executive session regard- ing personnel which would be held at some point in the meeting. MINUTES OF JANUARY 10, 1983 Councilmember Klein had the following correction: Page 2838, first line, the word "economy" .should be. "economics." Councilmember Witherspoon had the following correction: Page 2826, middle of page, the first line of the motion should be corrected to add following the word "remove" "from the -table." MOTION: Councilmember, Eyerly moved, seconded by Renzel, approv- al of the Minutes of Jenuary 10, 1983 as corrected. MOTION PASSED unanimously, Fazzino absent. MINUTES OF JANUARY 17, 1983 Councilmember Klein had the following correction: Page 2866, last paragraph, first part of second sentence should read, "He had been concerned about this discrimination problem for the two years he had been on the Council, and believed..." MOTION: Councilmember Renzel moved, seconded by Eyerly, approv- al of the Minutes of January 17, 1983 as corrected. MOTION PASSED unanimously, Fazzino absent. ITEM #1, RESOLUTION OF APPRECIATION TO HELEN TAO Mayor Bechtel said that Ms. Tao was unable to attend tonight's Council meeting. Ms. Tao had served three consecutive three-year terms on the Human Relations Commission from January 1, 1974 to March 31, 1983. She served as Vice Chair twice and had given ex- tensively of her time. Her service to the City and the HRC would be missed. Councilmember Eyerly added that Ms. Tao had served for a long time, and was on the HRC when he joined the Council. She had served diligently, wholeheartedly and calmly, and had` been an as- set to the HRC. Helen was one of, the few appointed individuals who served for as long as she had, and he appreciated the efforts she made. MOTION: Councilmember Levy moved, seconded by Witherspoon, ap- proval of the resolution of appreciation to Helen Tao. RESOLUTION 6103 entitled 'RESOLUTION OF THE COUNCIL OF 1HE CflT of PALO ALTO EXPRESSING APPRECIATION TO HELEN TAO FOR OUTSTANDING PUBLIC SERVICE AS A MEMBER OF THE HUMAN RELATIONS COMMISSION" MOTION PASSE© unanimously, Fazzino absent. ITEM #2, RESOLUTION OF APPRECIATION TO AGNES C. ROBIPISON Mayor Bechtel said the resolution recognized that Agnes Robinson had served the City of Palo Alto as a member of the Human Relations Commission front August 10, 1980 to March 1, 1983. She hoed -given unselfishly of her time, talents and- leadership abili - - ties to _assist. in guiding the growth and, developmen.i: 'f the _City in' the best interests of . the total community. Agnes Robinson made a significant personal contrib tlon to the community through her diligent and conscientious efforts while serving as a- member of the Human .Relations Commission. _` The City' of Palo Alto wished to 3 1 0. 6 4/04/83 recognize the service of Agnes C. Robinson, and gratefully record its appreciation as well as the appreciation of the citizens of the community for outstanding public service rendered by Agnes C. Robinson. MOTION: Counctlmember Levy moved, seconded by Renzel, approval of the Resolution- of Appreciation to Agnes C. Robinson. RESOLUTION 6104 entitled "RESOLUTION OF THE COUNCIL OF 7117-7777-7-7ALO ALTO EXPRESSING APPRECIATION TO AGNES C. ROBINSON FOR OUTSTANDING PUBLIC SERVICE AS A MEMBER OF THE HUMAN REs.ATIONS COMMISSION" Councilmember Fletcher said that while Agnes Robinson was on the Human Relations Commission, she put in an extraordinary amount of effort. Her conscientiousness and diligence were marked by the fact that she voluntarily resigned because of other responsibili- ties she recently acquired since becoming a member of the Communi- ty College Board. Some people might have continued on the Commis- sion under those circumstances, but because Ms. Robinson did not feel she could contribute 150 percent, she resigned in order that Council may appoint someone with more time to devote. Her service on the Commission was extraordinary. MOTION PASSED unanimously, Fazzino.absent. Mayor Bechtel presented the framed resolution of appreciation to Ms. Robinson. Agnes Robinson said she felt terrible when she gave up an assign- ment before the end of the term. She felt privileged to serve on the Human Relations Commission and especially to work with Coun- cilmember Fletcher and Hal Anjo. She believed the Commission had made some forward progress especially on the Human Services Plan. Further, she thanked the City Council for passing the resolution in February, declaring the month of April as Nuclear War Prevention Month and for Mayor Bechtel's attendance and comments at the Easter services which were so beautifully put together. Those actions put Palo Alto in a leadership role and said that a Human Relations Commission: was indeek.` an important part of the City. Sheurged the City Council to continue to look to the HRC for help and advice in any way possible. CONSENT CALENDAR Mayor Bechtel sai she had received cards from members of the pub- lic who wished to address Item #4, Housing Development on the Terman Middle School Site, and Item #10, Approval of Housing Assistance. Plan for Community Development Block Grant Program, and, therefore, remoeed those items from the Consent Calendar. MOTION: Councilmember Cobb moved, seconded by Klein, approval of the Consent Calendar as amended. Referral ITEM #3, UTILITIES RULES AND REGULATIONS REVISED REFERRAL TO Action ITEM.,#5, RESOLUTION RE CALIFORNIA RESOURCE RALLY (CMR:232 3) Staff recomrends that Council adopt the resolution that endorses and supports the goals of the Great California Resource Rally. RESOLUTION 6105 entitled "RESOLUTION OF THE COUNCIL OF, ALTO ENDORSING AND SUPPORTING THE GOALS ©F' THE CALIFORNIA RESOURCE RALLY AND URGING CITY PARTICIPATION IN RECYCLING, LITTER CONTROL AND WASTE ''REDUCTION ACTIVITIES' 1 ITEM #6, ORDINANCE AUTHORIZING NORTHERN CALIFORNIA POWER AGENCY ISSUE BONDS, NOTES AND REFUNDING BUNDS (2nd Reading) ORDINANCE 3421 entitled "ORDINANCE OF THE COUNCIL OF THE CITY OF FALO ALTO AUTHORIZING ISSUANCE OF PUBLIC POWER REVENUE BONDS BY NORTHERN CALIFORNIA POWER AGENCY (GEOTHERMAL GENERATING PROJECT HUMBER 3)" (1st Reading 3/14/83, Passed 9-0) TO ORDINANCE 3422 entitled "ORDINANCE OF THE COUNCIL OF THE CITT- OF PALO ALTO AUTHORIZING ISSUANCE OF NOTES BY NORTHERN CALIFORNIA POWER AGENCY (GEOTHERMAL GENERATING PROJECT NUMBER 3)4 (1st Reading 3/14/83, Passed 9-0) ORDINANCE 3423 entitled "ORDINANCE OF THE COUNCIL OF THE rill OF PALO ALTO AUTHORIZING THE ISSUANCE OF PUBLIC POWER REVENUE REFUNDING BONDS BY NORTHERN CALIFORNIA POWER AGENCY" (1st Reading 3/14/83, Passed 9.0) ITEM #7, REFUSE CURBSIDE COLLECTION OF RECYCLABLES AND RUBBISH n ea ing ORDINANCE 3424 entitled "ORDINANCE OF THE COUNCIL OF THE CITT OF PALO ALTO AMENDING SECTION 5.20.030 OF THE PALO ALTO MUNICIPAL CODE TO PROVIDE FOR THE CURBSIDE COLLECTION OF RECYCLABLES AND RUBBISH" (1st Reading, 3/14/83, Passed 9-0) ITEM #8, CONTRACT FOR ADMINISTRATION OF SELF -INSURED WORKERS` Staff recommends that Council authorize the Mayor to execute the agreement with Leonard J. Russo, Inc. for claims administration services. The action is not a project as defined in Title II of the Palo Alto Municipal Code, and, therefore, no eevi ronmental assessment is necessary. AGREEMENT FOR ADMINISTRATION OF WORKERS= COMPENSATION PROGRAM Leonard J. Russo, Inc. ITEM #9, MULTI -FAMILY RENTAL MORTGAGE REVENUE BOND PROGRAM - APyRTJyAL 10 -CUUP RA I/Vr A'REtNt11T R : z41 : 3 Staff recommends that Council approve the Cooperative Agreement with the County of Santa Clara. COOPERATIVE AGREEMENT BETWEEN THE COUNTY OF SANTA CLARA AND CITY OF PALO ALTO:. County of Santa Clara nOTION PASSED, unaniiously, Fazzino absent. AGENDA CHANGES, ADDITIONS AND DELETIONS City Manager Bill Zaner said that item -#4, Housing Development On. the Te-rmap Site would become Item #12-B; and Item #40, -Approval of Housing Assistance Plaru for Community_ Development Block Grant Program, would remain in its. place, but become Item #9-A. ITEM #9-A `OLD` ITEM #I,0 , APPROVAL OF HOUSING ASSISTANCE PLAN FOR Councilresnber, Levy said ,that _ under .the section, "Lower : Income Households Expected . to Reside," on page 1 of Appehdi x B attached to CMR:230:3, stated that "A -letter from HUD, dated November 21, 1979 provided _the City .with an ETR of 0 because it was determined that the ratio of lower( income households to total_ household in Palo Alto exceeded the corresponding ratio for the SMSA (Standard Metropolitan Statistical Area)." He asked if that meant that HUD had determined that Palo Alto had more lower income households for its population then Santa + Clara County taken 'as a whole. City Planner Glenn Miller clarified that as a whole, Palo Alto's average was higher than the average city in Santa Clara ,County. HUD provided, as part of the prior housing assistance plan, an appropriate figure to use in the proposed housing assistance plan. The City had the option to provide an "estimated -to -reside" figure, or use the figure provided by HUD. Director of Planning and Community Environment Ken Schreiber said that for many years the "expected -to -reside" number used by HUD in the housing assistance forms, was almost undecipherable: HUD's reasons for providing that number were confusing, and every commu- nity of which he was aware simply used the number provided by HUD. He knew of no one who had ever received a decent explanation in terms of the basis for that number. He did not give the number much credence and suggested that it was one of those HUD rules where they provided the number and the City, was supposed to use i.t. Councilmember Levy said he was always confused on vacancy rates and HUD stated that Palo Alto's housing vacancy rate was 2.25 per- cent. He asked how that jibed with the data the Council con- stantly received which indicated that the City's vacancy rate was less than one percent. Mr. Miller said the City was informed by HUD that in every case possible, it should use the date which was available from the United States Bureau of Census, George Zimmerman, the City's Principal Planner, was working on additional information regarding comparisons between how the vacancy rate was determined for the condominium conversion ordinance and how it might differ from the census. That information was expected to be provided to the Coun- cil within the next month. He understood that the Census' vacancy rate might not be as accurate as the City's, because sometimes the Census included as vacant units those which were under construc- tion, and others were included because no one could be found at home during a recent survey and after several census takers had gone to the house and attempted to locate a resident. Several other factors could also overstate the census figures. C0iJNC1LMEMBER FAllINO ARRIVED AT 8:00 p.m. Councilmember Levy asked if any rental units were under construc- tion at the time the census data was taken. Mr. Miller responded that the most recent census data was from April, 1979, and although several of the units constructed were condominiums, he, was certain that several were also rentals. Mr. Schreiber said that HUD took a condominium development which was under construction and counted all of the units as vacant rentals because all multiple family structures were placed in the rental category. Counts lme=nber Levy said he noticed that a grant was approved to Colorado. Park for .major roof repairs. Colorado Park was only about 10 years old, and asked why major roof repairs -were needed.- Mr. Miller said that: Colorado Park was a flat, tar and. gravel-- , :toe. Duri ng, the dl scussi ons about whether to fund the grant for Colorado Park, a number of contractors provided staff with oppos- ing views .. -,Bone said that a tar and : gravel roof Could. not be expected to last' more than -ten years, and others said it should last close to 15 years. After debating rthe pros and cons of whether to fund such a project, Colorado Park_ was thought - of -as an. importants housing project in Palo Alto which needed support. _ CDBG was, therefore, recommended-; for' undi rfg, 3 1 0 9 4/04/83 1 Councilmember Cobb said there was something which could be con- strued as a specific application to HUD with specific numbers in it and he referred to staff's memorandum of _March 31 scheduling some additional meetings of the Terman Working Group. He asked if the numbers listed in the Housing Assistance Plan locked them into a formula or was -there an. opportunity to discuss those with the people from the Terman Neighborhood and work out something that was acceptable to the entire neighborhood. Mr. Miller responded that the Housing Assistance Plan did not lock the Council directly into any specifics. The Housing Assistance Plan said that the City of Palo Alto would like to be eligible for resources available from the federal government and it must have certain base line numbers or units in its Housing Assistance Plan. In other words, the City could not qualify for possible housing resources for various projects unless the Housing Assistance Plan indicated that those resources were needed. From the same stand- point the federal government did encourage cities to have goals that were realistic and yet was not supplying resources. Councilmember Cobb wanted to pursue that a step further. As he understood it, there were 72 Section 8 units for the Terman site and assuming that as a result of the meetings with the Terman Working Group a smaller number emerged, would it still be a valid application even though the numbers had changed. Mr. Miller responded that it would be a valid application. Councilmember Witherspoon was curious if the City had met its goals and if anyone ever asked if they were meeting their goals. Mr. Miller said they were asked, but Palo Alto was not looked at as closely as other communities because the City had a very good record in the area of housing assistance. In terms of rehabilita- tion goals, the City had more than met their goals. In some hous- ing assistance such as family rental housing, the goals had not been met but HUD has been patient and had sent them letters cautioning the City to keep working on housing assistance. Bob Moss, 4010 0rme, said he was concerned that by .submitting the Plan to HUD they would be preempting the meetings that would be held later in the month to discuss the 72 Section 8 units at the Terman site. Some people might be aware that the neighbors in the area who were not active particlpants in the Terman Working Group wereextremely upset about the prospect of Section 8 units on the site. He wanted to be sure that by submitting the application the City was not making a firm commitment or pre-empting the Working Group process. The way the Plan was presented the statements appeared to be firm and he had the impression it was going to happen and 'the City was really going to do it. He was concerned regarding the reference to lower income households and referred to the Table 2 Rental Subsidy (deeds of Lower Income Households and Units Expected to be Assisted for Lower. Income Households. Lower income households had a different connotation to HUD than people in the community where they were accustomed to thi nki ng of people between 80% to 120% of the county -wide average. He thought it would-be useful if the actual income levels were spelled out in the Plan. On page 2 of the narrative, part 2, regarding 96 rental units to be rehabilitated, 82 of which would .serve lower income units, there were -listed 60 at Colorado Park, 16 at Ferne_., and 8 for future _ acqu i st i on, which added up to 84, not 82. He questioned if there were 16 units al ready -rehabilitated at Ferne over the past year or was there:additional rehabilitation still. planned. Page 3 regarding'. the Palo Alto' Housing Corporation fcquiring or leasing a second site or sites tot up to 150 units, `implied that :it referred to the 5.1 'acre Mayfield' School site. Prank Morrow on March 16 talked about a Possible 80 to 85 low to' moderate income units on the site. The. _numbers did not correlate and' he Wondered if there were other sites in mind. A Palo Alto Census Tract Map showed the specific sites referenced in the report. It would be helpful to both the people at HUD and the citizens to either append a second map or expand the present map to show the existing assisted, or BMR, units scattered throughout the City --Webster Wood, etc. That .would help to achieve a better appreciation for the location of the assisted units and at the geographic distribution. He suggested that staff include caution- ary words when transmitting the documents, that the figures represented the goals the City hoped to achieve, but that circum- stances could change those figures. He urged that the Terman Working Group be given time to go through its procedure, and said he was di Sturbed when the plan came out before the group had its meetings on April 12 and 26. When the Group :initially became aware of the, HUD documents, it was also concerned about being locked into something before having the chance to operate. He hoped that was not the case. Mayor Bechtel said s_he understood that the purpose of the document was to conform to certain HUD regulations in terms of format. She believed that Mr. Moss' suggestion, particularly in terms of the Census Tract Map, was good if the document was going to be sub- mitted to the public for general information as to the progress of the City's projects. Mr. Zaner said that the timing for the housing plan was spelled out by the. federal government. It was a part of the CDBG process which went ` through =a citizens' committee and would be a part of the City's budget for City Council approval. The timing regarding the plan and the Terman project were coincidental. The Housing Assistance Plan would have been on the agenda per the federal government requirements whether or not Terman was up. Mr. Miller added that the -.beginning of the report stated, "This document actually covers -a period of time October 1. That infor- mation was not covered at an earlier date because HUD advised that it be delayed, and et the last minute said that it should be done right away. That plan was supposed to be in the hands of .the federal government immediately, and local communities were hur- rying to have them completed. He clarified that some sites, such--. as Terman and Mayfield, were specified but were -not in any way identified as definite sites.. . HUD required that various goals be included, and if estimates had to be made, staff proceeded at the direction of the federal government. -Staff had not tried to make a long document that read smoothly, but rather responded. in accordance with directions from the federal government. MOTION; 'Councilraember Klein moved, seconded by :Fletcher, that Staff be authbrized.to submit the 1982-85 Housing Assistance Plan to the Department of Housing and Urban Develop.ent It3TIOM-PASSED unaftiraoasly, including Councilmember Fazzino. ITEM #11 PARKIKO LOTQ AIR RIGHTS PROJECT - RESOLUTION REASSESS - Mayor Bechtel said that the proposed action would .set a hearing date for April 25, 1983, and she pointed out that the Resolution referred to. "AK Properties'", rather than Kinney and Kinney, Real Property Administratbr Jean Diaz' responded that currently the Option Agreement referred _.to "AK:_ Properties" : and the resolution was technically correct. Staff would return to the - Council On April 25 with minor clarification amendments to the., Conveyance Agreement. MOTION: Councilmember Cobb moved, seconded by Klein, approval of the resolution. RESOLUTION 6106 entitled "RESOLUTION OF THE COUNCIL OF GI ! T OP PALO ALTO OF INTENTION TO MAKE CHANGES AND MODIFICATIONS UNIVERSITY AVENUE OFF-STREET PARKING PROJECT NO. 52-13" Councilmember EYerly said that he would reluctantly support the motion. He believed Mr. Kinney had demonstrated good faith by providing the extra BMR units to the. City, and . had patiently worked with the City over the extended period of time. He was pleased that the City had gained more lower priced units in the receet negotiations. However, the priorities of air rights on the downtown assessment district parking lots needed to be reanalyzed, in his opinion, as to whether the air rights should be used for housing or parking. ;le reminded the Council that the City was shy approximately 2,500 parking spaces in the downtown, and that those people who could not find parking spaces were parking in the neighborhood areas, which the City had unsuccessfully tried to deter in various ways over the past four years. The reports con- cerning the feasibility of ramping or multiple decking some of the parking lots in the downtown area, -showed that only one other lot would be suitable to provide a major parking area for the downtown lots. The rest were feasible for ramping which meant only ,one other layer of parking. He did not believe that all of those pos- sibilities added together would take care of the parking shortage in the downtown area. When the proposed project was finished, he hoped that the City Council who heard the next application for the use of air rights would carefully weigh the needs of the downtown area. He felt strongly that the priorities, with regard to the fill-ins, modernizations and growth being experienced in the down- town commercial area, had to be reverted to parking and not house in 9. Councilmember Levy said that Items #11 and #12 on the agenda both spoke to Parking Lot Q and he was confused regarding at what point the Council spoke to the development project and its approval or disapproval. Mr. Dial said that Item #11 only adopted the Council 's resolution of intent and set a public hearing for April 25, 1983, which was the date the Planning Commission recommendations regarding the project would be before the _City Council. Thet was believed to be the opportune time to fulfill t,h:e assessment district change and modification public hearing requirement. Tonight, there was no commitment on the part of the City .Council" to carry the project beyond April 25, 1983. No approvals of the project would be made by any action tonight. He deferred to Mr. Miller for the implica- tions of any Council action on. Item 12. Councilmember Levy said he was concerned about theoverall ect, but believed the resolution of intent was ar.pro forma by which to approve the hearings. MOTION PASSED unanimously. proj - method ITEM #12I MORTGAGE REVENUE BOND PROGRAM - LOT Q AIR RIGHTS PROJECT City Planner Glenn Miller sal, d that the Developer Agreement would be submitted for the Mortgage Revenue Bond Program, and the City had to execute it_ before the full project was at the Council level. The Developer Agreement Specified price levels which were slightly ,di tferent than the ones . last. proposed. The proposed,.. deireioper agreement replaced the previous " agreement and contained a ` different price. Stru`ctur'e. Exhibit B was already executed by Mr. . Kinney. and included the new prices. The Council was being asked to approve the prices for those units- which : were to tie financed with mortgage revenue bonds. The Developer Agreement specified prices for the units financed by mortgage revenue bonds. Councilmember Cobb said that the nine BMR units listed were_ the smaller sized ones. "He asked if the other units in the project were comparable in size or if they were larger. Chuck Kinney, Kinney arrd Kinney, the applicant, said that the nine BMR units consisted of two, one -bedroom, one -bath, 510 square foot units; three, two -bedroom, one -bath, 770 square foot units; and four, two -bedroom, one -bath, 820 square foot units. The remainder of the 35 units would have four, 820 square foot, two -bedroom, one -bath units, and three of the 770 square foot, two -bedroom, one bath, but the lower two floors _would have 11, two -bedroom, two - bath, with 870 square feet; and 11, two -bedroom, two -bath, with 920 square feet. Councilmember Klein said that at the Council meeting of January 10, he and Mr. Kinney discussed at length how much of a subsidy the City was receiving with regard to the 8MR units --or what the City was getting for giving up its air rights. Page 2838 of those. minutes indicated that at that time, the City was getting less BMR units because they would be smaller --about $250,000 worth --arid in exchange would get more units in the moderate range and financed by the County program, It appeared that the requested action represented another switch and he was confused about where the Council was. He asked what the City was receiving for giving up its air rights as compared to what would have been received with the previous two plans. Mr. Diaz said that under the latest proposed plan, the City was receiving nine BMR units, and as described by Mr. Kinney, there was a range in size attributable. They were not all the smaller units. The normal requirement for any developer was ten percent of the units, and In this case, the nine BMR units constituted over 20.4 percent BMR contribution. Councilmember Klein asked for a comparison between what the units would sell for on the marketplace, what the City would sell them for with the difference being the subsidy received, and how those numbers compared with the proposals which had been before the Council in the past 90 days. He said thesagreement was before the Council twice before. One agreement was heard by the Planning Commission, but Mr. Kinney made significant changes in hi.s pro- posals between the time the Planning Commission heard it in December, 1982, and the time the Council heard it in January, 1983. The amount of subsidy changed significantly from what the Planning Commission heard at the tine and what the Council heard. Now, there was a third proposal, and he was concerned that he did not know how to compare the proposals, and needed that information before he could vote. Mr."` Diaz said the current proposal suggested 8MR units at a much heavier discount. The prices of the units to the buyers would be a lot less than the prices which were originally proposed to the. Planning Commission and City Council. Mir. Diaz said he did not have that information in hand, and Mr. Zimmerman, who developed the data, was not in attendance. Mr. Kinney originally proposed prices ranging from $119,000 to $135,000, and 50 percent of the units initially submitted to the Planning Commission were to be under the. Mortgage Revenue Bond._ Program and the remei rider were to b• market rate. By the time the project was before the City Coun- cil, Mr. Kinney had thought of a way, by reducing the size of those units and thereby being able, to eeduce the overall `:price for all of the units, to qualify 100 percent' of the units for mortgage. revenue bond fi o4nce limits.- At that ` pai nt , the City asked for some : type of a price structure. Mr. Kinney, responded that he toeld hot live with the ..price structure as a fixed constraint. The Counti1 adopt,d the staff recommendation with the exception of two units that were, ;free to fluctuate with the market. Mr. Kinney said that the nine BMR units in the current proposal were each subsidized between $50,000 to $60,000. - Some were at $56,000. and some were at $62,000 dependent aipon size._ If they were rounded off to $55,000 multiplied by nine, they were looking at $495,000 as opposed to $250,000.- Councilmember Klein said he understood that the trade off was in the neighborhood of $500,000 in subsidies, and in _exchange, the City had no control over the prices charged for the other 35 units. Mr. Kinney said that was correct only to the point that as a final step in the process, he had to submit to the City a final cost and income statement verified by an independent M.I.I. and a cost engineer. At that point, his income and cost statements would be compared, and .if there was an excess of incnme, the City would receive a monetary consideration. Councilmember Renzel asked if the profit on those BMR units being provided were only on those units normally the consideration for the air rights along the parking. The costs of the units were generally. being paid for, and Mr. Kinney indicated a substantial subsidy for the units. She asked whether the prices included more than just profit. Mr. Diaz said as he understood the BMR pricing, it was the subject of negotiations on each particular project given the economics. The goal was that the BMR units be affordable to people generally within the range of 80 to 120 percent of median income. An addi- tional factor was the cost of providing those units to the devel - oper. Normally every attempt was made not to include developer profit and the land cost in any of the cost components to make it work. Typically, those two factors were excluded, and basically only hard costs were factored into the equation. Councilmember Renzel said Mr. Kinney had indicated about a $500,000 subsidy by providing the nine units at below market rates, and since the prices for the BMR's were negotiated to cover the major part of the costs, the subsidy .only covered developer profit. Mr. Diaz said there was an in lieu land cost. .The developer had other costs which he typically would not have in another project. Although the City might not charge the "going market rate" for the property, the developer had other obligations that constituted out-of-pocket expenses, and ate into any profit which might be expected. The true subsidy, when compared to other projects, was not the difference but what it would sell for on . the market and the prices of the BMR units. MOTION: Vice Mayor Fazzino moved, seconded by Witherspoon, .approval: ofthe staff recommendation to execute the Developer Agreement. DEVELOPER ACREENENT BETWEEN 1CINNEY AND KINNEY COUNTY 'OF SANTA CLARA AND CITY OF PALO ALTO Kinney . and Kinney Council member Levy said that the project had . been discussed at length in various different financial structures He found the proposed financial structure to be the most acceptable and straightforward. There were two categories of pricing--une was completely ,protected in the' BMR- category., and the others were at rket rates. However, he sti 1t found the project to be tundamen-. - tally , unacceptable'. _Me believed the. Ci ty> was giving up . far- move.: than . just the air rights with the proposed project. The land, when ..orf i nal ly appraised at RIM -5 or'. CC zoning was appraised between $700,000 and $2,000,000 dependi ng upon _. whether it would ultiarately be _used for one use ;or another. The, City was giving away' land worth $750,000 or more. Albeit, the City was only, 3_: .1, 1,3. 4/04%83 giving away the air rights above the land so the value was not quite that high. Further, the maximum zoning permitted in Palo Alto was 45 units to the acre, which allowed tor 24 units on the parcel. The City was permitting 44 units, and in effect was do- nating 20 units. Normally, those 44 units would require 66 tenant parking spaces, but because of the location, the City was allowing 44 tenant parking spaces, which was a gift by the City of 22 park- ing spaces. Fundamentally, the City was giving up the future rights to the development of that land in perpetuity. The devel- oper was providing in return 4.5 extra BMR units, and approximate- ly 56 or 34, ' dependent . on how one looked at the parking numbers, extra parking spaces. He did not believe that was a fair trade off. He believed the City was giving far more than it should for a project that would be dense in a downtown area which was already crowded. Councilmember Klein said he was pleased that the.: proposal seemed to have met with a lot of support and cut through the knot they were getting into the last time the developer was at the Council meeting. He understood that Sylvia Semen deserved a lot of credit for her help, and he thanked her. He believed the proposal was a good one, and did not believe the City was giving anything away. The City was getting several things in return, and he could sup- port the project. The extra BMR units were a consideration, and dependent upon the formula used, could be valued at either $250,000 or $500,000. The extra parking spaces were easily valued --those two numbers together gave a number in excess of the minimum amounts described as the value of the property. The in- tangible value was the most imaginative of the proposals previous- ly before the Council and would get the City a significant number of moderate income housing units. Although the prices of those were not fixed under the proposal, the economics of the project were such that the prices would be more affordable than what was being seen elsewhere in the community. The property being "given away" was not the most desirable piece of property in town. They were not talking about property located at the corner of Hamilton and Bryant, but rather the stretch on High Street, which he opined to be one of the least desirable parcels in the downtown and per- haps the whole City. He believed the project would substantially enhance the value of the community by dressing up a presently poor block in town. Further, the project represented an imaginative and and economic use of space that would not otherwise be used. All of those items added up to a project which should be encouraged and supported. Councilmember Cobb said he would support the proposal. He saw the project as an experiment in the use of air rights to see whether the concept was something that could work and make sense in Palo Alto, and as an experiment in terns of developing those small units, which he had concerns about being too small He was inter- ested in supporting the experiment to see how it worked, and believed Mr. Kinney was the kind of conscientious developer willing to give a good effort. He wanted to proceed cautiously with similar developments in the future .until the results of the one proposed were seen because " he wanted to know whether the con- cept worked well enough in Palo Alto 'before pressing ahead with many more of the same. He wished.- the project well and hoped ' it was a success. .Councilmember Cyerl y. said that Lot _Q: was, recognized-' by the . City's consultant as one for ramping if it were to go to parking only. That would provide double the spaces on the _ground or about 74 spaces. The estimated current" cost ' per parking space- in the assessment district =downtown wits+ $10,000 per stall or $740,000 if' the developer ,:had. put :;in one -complete ,deck of parking. - That was not done, -but :,_the City was given 42 new spaces or about .$420,000 and ''22 shared spaces, -which might wells out tothe-advantage to the parking district. -or another., $220.,000. In parking, the developer was gtving..the .City .abotk"$640,000 for 'the air rights, and when that was added to the Subsidy on the nine BMR units, .the total was 1 1 1 1 1 about $2,150,000, which seemed feasible for the use of those air rights. He hoped there would be no more air rights developments without the full layer of parking for the assessment district. The consultant said that Lot Q could support and share a full layer of parking for the assessment district. He believed that could be done with the priority being for parking and not housing. Councilmember Renzel said she ws disappointed in the evolution of the project. Everyone had such high hopes of obtaining real affordable housing in significant numbers by using City land which was currently used only for surface parking. On the other hand, the project was experimental and there were many risks involved in the first project, which would hopefully not be involved in subse- quent projects. She had some of the same concerns as Council - member Levy with respect to density, parking and other issues because she believed everyone was well aware of the parking short- ages downtown. On balance, she believed it was worth going for -- ward with the project although she was sorry that it took the par- ticular turn in the nature of 'the affordable housing being pro- . vided. Councilmember Levy said that regarding Councilmember Klein's com- ment that the land being given up was not particularly valuable, on that same block was a project now being built. It was, described as having a total expenditure of $8,000,000, including land which was somewhat larger than Lot Q valued at $2,225,000. The City was giving away a prime piece of property which was now open and providing parking. Not only were the development rights to that land being given away in perpetuity, but the City was going out of its way to double the allowed density. MOTION PASSED by a vote of 8-1, Levy voting °'no." 444444214 ITEM #4 , HOUSING DEVELOPMENT ON THE TERMAN MIDDLE Ann IrLA iNZNi CUMMISSUJ (C'NR:zJI:3) Mayor Bechtel said that Item #4, was a referral to the Planning Commission and that there would be maple time for questions from members of the public and residents of the neighborhood at the public meetings which were scheduled for Tuesday, April 12, and the seond meeting would be April 26. Director of _Planning and Community Environment Ken Schreiber said that a Terman neighborhood meeting was scheduled for Tuesday, April 12, 1983, and another neighborhood meeting was scheduled for two weeks later, but that would deal with different topics --not housing. There would be a later neighborhood meeting on the housing issues, but that date was not yet -determined. David R. Sborov, 4225 Ynigo Way, said that the Terman neighborhood was : not against assisted housing on the Terman site, but was. against the proposal of the Palo Alto Housing Corporation.- It was important to understand that before the matter went through the referral process. The Council was not only being asked to refer something, but also to endorse, initiate and expedite something` being put on a fast track process. The Terman neighborhood was disturbed by that because:.there were a number of issues which 'had. not yet been discussed publicly. Everyone in the Terman neighbor- hood . remembered the "fast _ `track" process that the Palo Alto Housing Corporation and !CC :' almost : got onto before the Terman Working Group was established, It was through the establishment of that group ands-through the concerns 'of - the neighborhood, PAHC and the Jet that the Terman-Plan we establistedi After. that Plan was established, things seemed to run smoothly and the residents of the neighborhood seemed to get along quite well. Now, it appeared to -be raising its head again, and that' the neighborhood was being pushed into something where the full ramification's and implications were .unknown. Everytime he tried to ask a signifi- cant question, he was told that there would be a public meeting next week where it would all be explained. He was sure he had asked questions for which there were no answers, and wondered whether they would really be explained adequately on April 12. He provided a memorandum to the Council which listed ten specific questions of fact and substance. During the .referral process, a number of those questions .would be addressed by the Planning Com- mission, Architectural Review Board, and other City. bodies. How ever, there were a number of questions that could only be ad- dressed and decided by the City Council. With. regard to owner- ship, management, potential conflicts with the Terman Plan and ultimate costs, he asked the following: 1. He understood that the ownership of the project would dwell 70 percent to a private developer and 30 percent to the .City - sponsored housing corporation. What happened if the developer sold his interest to another invester group and so forth and so on, how far away from the original purpose of the housing development would the City go? 2. Was the type of joint venture agreement being discussed in the best interests of the City? 3. The management of the project would be retained by the private developer. Would the management be consistent with the Terman Plan, aed how could they be sure that the management world continue to be consistent with the Terman Plan in the future? 4. Could housing be restricted to certain groups? 5. Could housing be restricted to certain income groups? Those questions needed to be answered for the Terman neighborhood. The project was a resurrected Section 8 housing project which, was originally -to be developed in San Mateo County. The costs to the City, in terms of indirect or direct subsidies, were unknown. at this time. The questions were significant and needed to be ad- dressed, but would not:be addressed before the Planning Commission or the Architectural Review Board.: Up until now, the proposed housing and various City features had gone through a specific process with the Terman Working Group and he was disturbed that the City's movement was accelerated before going back to the Work- ing Group. He urged. the Council to delay its referral until after some of . those- questl_ons were answered and until after the Terman Working group could provide recommendations. If the referral could not be delayed; he urged that the motion be defeated in its. entirety. Mayor Bechtel said she .was confident that 14r. Sborov's questions would be answered by staff and.by members of the Palo A1to,Housing Corporation at the meetings ` next week and before a _final decision was made at the City Council level Counci lmember Fletcher said that it was evident that . the Council was not ready to discuss the specific questions raised tonight. The process was only beginning, and tne project was not being ap- proved at this point. The matter was for referral and there would be ample opportunity to discuss the questions in depth at the Planning Commission and when it returned to the Council. MOTION:. Councilmetaber Fletcher mowed, seconded by Renxei, regarding the housing development on, the Teresa Middle Scheol site, to refer the Comprehensive Plan and Zanine Changes and. Parcel Map to the Planking .,Commission.' Councilmember. Cobb said the Planning Commission was established to answer the kinds of questions .raised by Mr. Sborov, and he had a lot of faith in Palo .Altos excellent Planning Commission. He did not believe that voting to refer the matter to the Commission 1 in any way prejudiced the -=final outcome. He would support the -motion to refer, with a verbal request that the Planning Commis- sion and staff dig into the questions raised 'by Mr. Sborov_ and see to it that they were properly answered'to that.when the matter was before the Council for final decision, a knowledgeable decision coal d be made. He urged Mr. Sborov and his neighbors ' to. speak to - and before the Planning Commission and ARB in order to have all the information and a chance to absorb it in order to make a final decision. He did not believe a motion to refer would in any way prejudice the final outcome; Vice Mayor Faz ino agreed with the comments made by- Councilmember Cobb. He redeived Mr. Sborov's memo tonight and had not had the opportunity to peruse it, but intended to in 'order to analyze his concerns . He did not feel that he endorsed anything of substance by a ki.ng that the whole issue of zoning be reviewed by staff and the Planning Commission. He would --have a completely open mind when'the,matter was returned. He could recall when a number of Counci lmernbers expressed concerns two or three -years ago about the_ fast track nature of the Terman process, and there was a long Council meeting, which ultimately resulted in the establishment of the Terman Working Group, and many of the issues went back to square one at that time. 'He hoped Mr. Sborov could leave knowing. that the issues would be discussed and that the Council was in no way committed to any of the_ specifics raised in his memo. POTION PASSED unanimously. ADJOURNMENT TO EXECUTIVE SESSION RE PERSONNEL Council adjourned to executive session re personnal at 9:00 p.m. FINAL ADJOURNMENT Final adjournment at 10:15 p.m. ATTEST: APPROVED: 3 1 1 4/04/83