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HomeMy WebLinkAbout04221974CITY COUNCIL MINUTES CITY PALO ALTO April 22, 1974 Adjourned Meetin of Appril 15, 1974 The City Council of the City of Palo Alto met on this date at 7:4c0 p.m. in an adjourned meeting of April 15, 19Th, with Mayor Comstock presiding. Presentation by Cubberlev Chorale NISOINIBRIF Prior to the roll call, the Cubberley Chorale entertained those present with three selections. It was announced that the group would leave tomorrow corning to visit Oaxaca and Mexico City and to participate In a number of musical activities in those cities. Mayor Comstock presented the with a proclamation proc1aitling April 26 to May 1 "Days of Music in Oaxaca." Roll Call Present: Perwald, Clay, Comstock, Henderson, Morton, Pearson, Rosenbaum, Sher Absent: Beahrs Resignation of Lawrence Klein from Mayor Comstock announced that Council had received a letter from Lawrence Klein stating that he will be on leave of absence from his law firm for a few months and will be working in Washington, D. C., thus making it necessary to resign from the Planning Commission. MOTION: Mayor Comstock moved, seconded by Pearson, that Council adept with regret the resignation of Lawrence A. Klein from the Planning Commission effective April 25, 1974. The motion passed on a unanimous vote. Mayor Comstock directed the City Clerk to advertise the vacancy. Ordinance Amendi PAMC to Allows is r an Industrial Districts�•�: : �.. �.�.. MOTION: Mayor Comstock introduced the following ordinance and moved, seconded by Pearson, its approval for fi=st reading; and finds that no significant environmental impact will result from this action: 4/22/74 391 "ORDINANCE OF THE COUNCIL OF THE CITY OF PALO ALTO AMENDING TITLE 18 OF THE PALO ALTO MUNICIPAL CODE TO ALLOW DWELLING UNITS IN COMMERCIAL AND INDUSTRIAL DISTRICTS" The ordinance was approved for first reading on the following vote: AYES: Berwald, Comstock, Henderson, Norton, Pearson, Rosenbaum Sher NOES: Clay Community Cultural. Center Landscape improvements: Bfd Award T :4) MOTION: Mayor Comstock moved, seconded by Henderson, that Council find that this project has no significant environmental impact. The motion passed on the following vote: AYES: Comstock, Henderson, Norton, Pearson, Rosenbaum. Sher NOES: Berwald, Clay MOTION: Mayor Comstock introduced the following ordinance and moved, seconded by Pearson, its adoption: ORDINANCE NO. 2782 ENTITLED "ORDINANCE OF THE COUNCIL OF TEE CITY OF PALO ALTO AMENDING THE BUDGET FOR THE FISCAL YEAR 1974-74, PROJECT 7345, FOR LANDSCAPE IMPROVEXENTS Al THE CO* NIPSITY CULTURAL CENTER" The ordinance was adopted en a unanimous vote. MOTION: Mayor Comstock moved, seconded by Henderson, that the Mayor be authorized t, execute an Agreement with Rudolph Watson, Inc., in the amount o $24,214, to build and plant the Garden Patio at the Cultural Center. The motion passed on a unanimous vote. Landfill Environmental act Statement =Mint Saiec : 2ZW: t) MOTION: Vice Mayor Pearson introduced the following ordinance and moved, seconded by Henderson, its adoption: ORDINANCE NO. 2783 ENTITLED "ORDINANCE OF THE COUNCIL OF THE CITY OF PALO ALTO AMENDING THE BUDGET FOR TEL FISCAL YEAR 1973-74 TO PROVIDE AN ADDITIONAL $36,000 IN THE REMSE FUND FOR LANDFILL PERMIT APPLICATION" Councilmen Sher asked how clone the permit application would came to the edge of the creek and whether or not the green belt along the creek would be included or excluded. Mr. Deverel replied that the boundaries of the permit appIieAtion are the same as the landfill area which has been designated by Council action for landfill purposes. The manner in which the 4/22/74 392 work is performed is subject to review by the Corps of Engineers, the Regional Water Quality Control Board, staff, and Council. Several suggestions have been made to mitigate the encroachment on the Baylanda such as fill short of the Matadero Creek levee; fill to the levee but maintain a shallower slope so there is less intrusion. All of these matters will be given consideration as the process of permit application proceeds. It will be reviewed by Council and the regulatory agencies. Councilman Sher notes that the first part of Mr. Deverel's statement indicated that the application will conform to the a .tea that has been designated. This would make it possible to fill to the edge of the creek. Mr. Deverel replied that the permit is granted by the Corps of Engineers. If they granted it for the full fill, that is true. Council can at any time require staff to manage that land in any way it sees fit. Councilman Sher commented that he was not sure exactly at what point this question should be raised, but he Is concerned about the green belt along the creek. It is doubtful any filling should take place that close to the creek, and he would be happy if the application did not encompass that area. Mr. Deverel replied that if it is desired to convert this into park lsnd of any kind, it may very well be desirable Lor the city to have this permit to treat whatever land there is between the end of the landfill and the levee. As part of the process, the Corps of Engineers will hold at least one public hearing which will be held in this area, and there will be a n► ber of oppor- tunities for various groups to make their wishes known. Councilman Clay asked to what extent does land use affect the granting of the permit. After the study is completed, is the Water Quality Control Board concerned about what Palo Alto does with it twenty years from now? Mr. Deverel responded negatively. He said the Regional Water Quality Control Board will assure operating standards. The jurisdication of the Corps of Engineers relates only to elevation. Once the fill is completed,teither agency will have jurisdiction. Councilman Clay asked if staff had given any consideration to end use that might be affected by the manner in which the land is filled. Mr. Deverel replied that there had teen no consideration at this point. There is a wide number of options for ultimate use. Vice Mayor Pearson referred to a statement of page 6 of the proposal from Engineering --Science, Inc. to the effect that refuse disposal operationehave been practiced at the site for about 50 years. She said she hoped they would not predetermine that it is going to be a refuse fill. Perhaps the Environmental Impact Report will prove that Palo Alto should not fill these forty acres and some other method should be used. Mr. Deverel said that it is necessary to get retroactive approval from the Corpse of Engineers for a portion of the land that has already been filled. The purpose of the EIR statement has to do with the Corps of Engineers issuing a permit for landfill in their area of Jurisdic- tion. The EIR is not intended to explore alternative waste disposal methods. 4/22/74 343 Vice Mayor Pearson stated that they may find that people do not want a dump there, or that the wildlife and marshes are more important. She hoped that would come out in the report. See p. 420 See p. 420 Mr. Deverel stated that those factors will be considered and included in the report. Councilman Berwald stated that on the basis of questions that have been asked tonight by other Council members and his own questions, he would like to see this referred to the Finance and Public Works Committee. He feels that when projects go out to bid, there should be uniform specifications for everyone who is bidding on the project. He did not see in the agreement for professional services enoegh detail as to what is to be performed that would give him assurance that after the work is performed, that it would be approved by the Corps of Bngineerc and the Regional Water Quality Control Board. it is too vague. It leaves a wide amount of latitude in the work to be performed. Council should have more assurance and find out what the long-term requirements are going to be and if the work by this contractor will be satisfactory. He would not like to see the project partly completed and then find we had to have a supplemental appropriation to meet the requirements of the two agencies. If there are plans to put a golf course on the sanitary landfill and landfill should be designed now for the end use, and it would be better if the EIR were done by a consultant who knew what the end use of the land would be. Finally, he would like to have an executive session to satisfy himself of the qualifications of this firm from a technical and professional standpoint. He felt Council should know more about the firm than was presented ir& the submittal by Engineering --Science, Inc. MOTION TO REFER: Councilman Berwai d moved, seconded by Norton, that this item be referred to the Finance and Public Works Committee. Councilman Henderson stated it would be better if the bidding procedure were raised as a subject and handled in a broader sense. He did not sere what the committee could add to this proposal, and he was concerned at the delay. Judging from the material that was received on this particular problem, Council should be moving as quickly as possible, and it would be ai.whil.e before the Finance Committee could taker on anything else. Regarding the golf course, he said you cannot determine years ahead how a golf course should be laid out. If a golf course is everariiatly destined for the land, bulldozers would have to be brought in to move the dirt around. His only criticisms at the moment was that maybe Council should have had a little more detail on,the bids. He was curious as to why the $24,800 proposal was accepted instead of the one for $19.000. Usually Council sees the variations - in bids and the reasons for accepting a particular one. ?4r. Deverel stated that timing was important. Council may recall from earlier staff reports the sense of urgency that they Carps of Engineers feels in pursuing this matter. They had the city under a cease and desist order at one time. With diplomatic handling, the city got then to accede to continued operations. They are concerned that this is moving as slowly as it Is, and Mr. Deverel expressed fear that they and the other agencies sight look askance on further delay. Regarding specifications, Mr. Deverel referred to Item 2 (b) of the agreement and said that the requirements are spelled out. The specifications are quite 1 4/22/74 394 clear that they must meet the requirements of the agencies having jurisdiction. The consultant cannot guarantee the permits and discharge standards will be approved; so that language was avoided, but it does of ate that the data will met their requirements. Regarding ultimate use, Mr. Deverel did not think that .would be known for some time. It would involve referrals to the Planning Commission and possibly to a committee of Council. He stated that the qualifications of the consultant were thoroughly explered but agreed that an executive session would be in order if Council desired more discussion of the qualifications. 1e urged against referring it to committee for timing purposes. He noted that this is a proposal for a consultant firm and not a .bald. Price is a factor, but other factors are overriding. The bid for $19,000+ was simply net acceptable. That particular firm did not offer their qualifications; they did not indicate they had any understanding of the project and could not demonstrate successful work in related areas. City Manager Sipel commented that sometime ago there was discussion of the possibility of having a second golf course in the Baylands, but that never got beyond the thought stage. Staff has no direction to pursue that. Arthur Ogilvie, 948 Embarcadero Road, said he was asked to .appear by some concerned citizens. The concerns are in the areas of destruction of wildlife habitat, prevention of wildlife to carry on their life cycle; effects on endangered species, vegetation that will be destroyed because of this project, water pollution, and continued destruction of recycleable materials. He mentioned other disposal areas and studies that are under way as alternatives to this type of project. Vice Mayor Pearson felt that Council should not delay this. She said she ha.d checked out the firm, and it is reputable and highly recommended. She felt their price was reasonable and compared favorably with others which she cited. She considered the.perastt from the Corps of Engineers as merely back up and not a final. decision on land use. She felt that landfill was not the direction that solid waste disposal should go in the future. Councilman Rosenbaum commented that Councilman Berweld had brought up the point that perhaps the city is not protected with regard to whether the Corps of Engineers will accept the work.. He asked if these guidelines are pretty well understood. If the Corps doss not accept it, does the contractor have to perform more work until it does? Mr. Deverel replied that these kinds of contracts are difffruar to write. Staff is familiar with changing regulations, which is the reason for the wording "present requirements." They_ have avoided using the word "accept" and used "meet the requirements of." The requirements aro published in officialdw"'"nte of the two agencies. The limitation to understanding is that they are subject to soma interpretation. The contract is written so that the consultant is required to meet the requirements of these agencies. The data they submit to these agencies must meet their requirements as they presently exist. There is an admitted risk of changing requirements, but they have not.r+ranged a great deal in the past, and staff docks not expert them to .in the future. The contract thrust is to get the consultant to satisfy the two agencies. 4/22/74 395 Councilman Sher stated that his major concern with the referral motion was the timing question, Council is sensitive to the points raised by Mr. Ogilvie. Councilman Sher did not think by applying for the permit that the city was committing itself to fill all of the land within the permit area. It will make it possible to continue the present operation. Re thought the ultimate use idea had been explored, and as far as the question about what the consultant is contracting to do, he understood from the letter of submittal that they were agreeing to meet the requirements of the agencies. They won't guarantee there will be an unqualified acceptance of their submittal and approval of the project. Regarding the consultant's qualifications, he thought the staff report specifically dealt with that. To him they seemed to be a pretty good consultant for this kind of. job. Councilman Clav asked if a deadline had been set for having this completed. Mr. Deverel replied that once the submittal is made to these two agencies, it is in the laps of the gods. Councilman Clay asked if the consultant had done related assignments for the regulatory agencies. Have they worked in bay mud? Mr. Deverel replied that they have done work for the two agencies involved. They have also done similar work in the San Francisco Bay area. The work they have done for the Corps and Regional Water Quality Control Board wee not landfill permit applications, but they have done this for water quality control boards elsewhere. It is difficult to get a perfect match. This one is not perfect, but it has a number of things going for it. Councilman Clay referred to page 2 of thy, proposal regarding a subcontractor for geotec_hnicai assistance and asked what that implies. 2#r, Deverel replied that very few of these firms have a full capability. This firm would seek soils and geological work from another firm. It is a common practice. Councilman Clay asked if that were the case for all ofthe bidders, and Mr. Deverel recalled that it was for all but one. The referral motion failed on the following vote: AYES: Berwald, Clay, Norton NOES: Comstock, Aenderaon, Pearson, Rosenbaum, Sher Executive Session (Council recessed in Executive Session fro 8:27 to 8:42 p.m.) Mayor Comstock stated that Council met in Executive Session to review the qualifications of the candidate firms. Council was now satisfied and ready to proceed. Councilman Norton stated that without any mention of.wh*ther or not a second golf course is a good idea, neither did he want this consultant simply to justify yet another level of landfill.. 4/22/74 396 He felt that would be the wrong emphasis for the study.that.Council should have. The California Environmental Quality Ac.t urger which this consultant will be operating mandates that he consider alternatives for mitigation of the environmental impact. For the record, he would hope that the consultant would seriously consider the mitigating alternative of the acquisition cf the ITT land for reserves for future city needs for landfill. The ordinance was adopted on the following vote: AYES: Comstock, Henderson, Norton, Pearson, Rosenbaum, Sher NOES: Jaexwa1d, Glop MOTION: Vice Mayor Pearson moved, seconded by Henderson, that the Mayor be authorized to execute a contract with Engineering Sciences, Inc. for the indicated work. The motion passed on the following vote: AYES: Comstock, Henderson, Norton, Pearson, Rosenbaum, Sher NOES: }:erwald, Clay Palo Alto Flood i3a_sfc ro e;_t (CXR:263:4) MOTION: Mayor Comstock moved, seconded by Pearson, that the report on the Flood Basin Project be referred to the Planning Commission. The motion passed on a unansmau8 vote. St. Francis Drive Parking Restriction Modification (CMR:266:4) MOTION: Mayor Comstock introduced the following resolution and moved, seconded by Pearson, its adoption: RESOLUTION NO. 4934 ENTITLED "RESOLUTION OF THE COUNCIL OF THE CITY OF PALO ALTO SING RESOLUTION 2971 TO PROHIBIT PARKING ON CERTAIN PORTIONS OF sr. FRANCIS DRIVE AND RESCINMMO. PORTIONS OF RESOLUTION NO, 4862 (ADOPTED JANUARY 28, 1974) CONFLICTING WITH SAID PARKING PROU13ITIONU Lois ;1sith, 2300 St. Francis, stated that the orig./n*1 no peaking restriction grew out of a misunderstanding between residents and the city. So many people felt so strongly about it that.a compromise was worked out. She expressed appreciation for the efforts of Mr. Noguchf and Mr. Zimmerman in working out the plan.. She offered to answer any questions Council eight have. The resolution was adopted on a unanimous vote. Easements Barr ton Pro rty,, Imo -12(0 to Be to foe MOTION: Vice Mayor Pearson moved, seconded by Comstock-, thai Council authorize the Mayor to execute the grant of easement to provide 4/22/74 397 ingress and egress to theme two parcels along Monte Bello Road and fi..d that this action will have no significant adverse environmental impact. Councilman Norton noted that the easement is for the benefit of two lots. he suggested it should he worded so that it runs for two lots and not more so that in future years it cannot burden the easement. MOTION REWORDED: Vice Mayor Pearson, with the consent of second, agreed to have her motion end with a semicolon and add the phrase sand be limited to two lots." The motion as reworded passed on a unanimous vote. MOTION: Vice Mayor Pearson introduced the following resolution and :roved, seconded by Comstock, its adoption: RESOLUTION NO. 4935 ENTITLED 'RESOLUTION OF THE COUNCIL OF THE CITY OF PALO ALTO ORDERING VACATION OF AN UNUSED PORTION OF AN EASEMENT FOR OVERHEAD UTILITIES (LANDS OF THOMAS HARRINGTON)" The resolution was adopted on a unanimous vote. Bowdoin Traffic Barrier--Col.leRe Terrace Traffic Plan Councilmans. Sher stated that borne of the residents of College Terrace had approached him about the location of the barrier shown in Plan X and advised him they had been talking to Rev. Manfred B. hmann at the Lutheran Church about trying to solve the problem of the parking lot. Mr. Bahaartn is not able to be here thin evening, but he sent a letter in which he states his preference is to see the plan as adopted go into effect and watch what happens in the three-month trial period. Mr. D. M. Raskin, whose home is located at the corner of Bowdoin and Stanford, stated that he had polled the residents of the block, and they were almost unanimously opposed to the mid -block barrier. He had hoped the residents and the Lutheran Center could have a united plan, but they had been unable to reach agreement on the location of the trial barrier. Mr. Bahmaan did agree that he thought any permanent barrier should be located at the intersection. He said his principal objection to that location at the.prasent time is the expense and difficulty of modifying the parking lot so that the objectives of the church can be met. Mr. Raskin wanted the barrier at the intersection and said that a "No Through Traffic" sign would not prevent many motorists from starting down.the.block and having to turn around in people's driveways. He suggested that the city provide the church with a prominent "Do Not Enter" sign instead of the worn-out patnted exit sign, rather than. destroy the beauty of the Henderson plan at this time. He fait it would not be wise for Council to adopt a plan that is opposed by nearly every resident on the block in favor of someone who uses the facility once a week. Councilman Sher said his view has been that the city haa.to solve the barrier problem and the problem of people using the.parking lot as a shortcut from Stanford Avenue into College Terrace He thought it was important to underscore the fact that if the barriers 4/22/74 398 are to go in on a permanent basis, the Reverend M!r. Bahmann.thinks the corner location would be the best. He felt Council should go ahead with the plan it had adopted and said he would not propose any action at this point. Councilman Henderson stated that he planned to introduce.a.mvtion to have the barrier moved back to the corner of Bowdoin and Stanford Avenue. E. David Uggia, 446 Forest, #2, stated that he did riot view this as a permanent solution, but the barrier at the end has already been tried, and it is known what problems that causes. He felt it would be worthwhile to try the barrier mid -block for three months and see what problems it creates. Stuart Sargent, 53-3 Escondido Village, commented that ia battling the automobile, Council had dealt another blow to the people who have chosen not to depend on the automobile, because the bus service on Stanford Avenue has disappeared. People do use the bus and are not happy about seeing it die. Patty Shramck, 2075 Bowdoin, stated that she lives to the left of the barrier. One of the primary things we are talking about is convenience ---church convenience vs. convenience of the people on the street. She said It would be easier access to get into her house with the barrier in the middle of the street, but because she cares about the safety of the children, she thought locating the barrier at Stanford would decrease theflow of traffic. Each time Stanford reconvenes with students or football games, there would be an avenue of circular traffic an the street, and people will use tie church to get out. She suggested that the church might reverse the flow of traffic in its parking lot to solve the problem. Janet Knecht, 2165 Bowdoin, said that the children living.on the block are young and play in the street. She suggested it would not be very expensive to reverse the flow of traffic and have it go out on Stanford. The residents are opposed to this plan. It is their neighborhood, and she would like to see it be a nice place to live. Councilman Sher noted that Council considered both possibilities. Council has no power, since it is private property, to block off one of the entrances to the church. The use permit for the church required those entrances. Regarding reversing the traffic, the barrier at the corner will defeat the whole traffic plan ir. College Terrace, because it will provide a short c'ut from Stanford Avenue to the Industrial Park. Neither poasibiliry is feasible without the cooperation of the church. H. E. Seielatad, m ►er of the University Lutheran Church, *tate'i he was representing ehe congregation. When the church was built, the plan agreed upon was suggested by the city. It is not .possible to make any change in the parking lot plan without considerable expense and without losing some of the parking epaces. me temporary barrier that was in existence for some months caused.a gisat -deal of member frustration, and the congregation voted to ask Council not to have any barrier at Stanford and Bowdoin. The barrier in the center of the street would eliminate the problem caused when people quickly discovered they had an escape route by,going.the wrong way through the parking lot. The Lutheran Church of America 4/22/74 3,9 9 invested $255,000 in this facility, and the building permit gave assurances the city would continue to offer access by streets and public utilities. The congregation feels strongly that the barrier at the intersection is detrimental to its activities. See p. 420 Councilman Henderson stated that the original plan had a.barrier on Bowdoin at Stanford Avenue, and he did not think there should be an interior barrier, because it causes too great an inconvenience to the residents. The Policy and Procedures Committee supported placing a barrier at the corner. Even if the church lot.cannot be revised, it seems a rather minor inconvenience compared with a seven-day inconvenience to residents and confusion for thoae who live there._ As for traffic shortcuttiag through the march parking lot, he thought that was happening because Stanford was blocked off at Bowdoin. People could not go down Stanford Avenue. Now they can, If there should continue to be a problem, a "Bo Not Enter" sign could be put up, and if that failed, the city could lend the church a wooden barrier to set up during certain hours to block off the driveway. He felt the barrier should be moved back to the corner and that the congregation should go around to the College Avenue--Bowdoin entrance. MOTION: Couacilman Henderson moved, seconded by Pearson, that Council direct staff to -revise Plan X, of the College Terrace Traffic Plan, to move the barrier in mid -block of Bowdoin Street to the intersection of Bowdoin-Stanford Avenue. Vice Mayor Pearson referred to the letter from Reverend Manfred Bahmann and said that after asking the City Clerk to listen to the tape to find out exactly what occurred at 12:30 in the naorc ing at the April 15 meeting, it was determined that it was not quite the way he said in his letter. It was actually that Council discussed during the meeting how the item could be ateied up so that Interested people would not have to stay here until 12:30. Council was not able to do that; so Mr. Hellmann misunderstood. She continued by stating that she supported moving the barrier, There is a bone of contention between members of the Policy and Procedures Committee as to exactly what came out of the committee discussion. It was her understanding when she looked at Plan X that the barrier was located at the intersection, and in committee that is what she thought was being moved. She feels the intersection should be closed at the corner. Regarding the bus route, she felt that change could not be blamed on this system, because the bus system in the future was going to be changed anyway, and Dial -a -Bus was going to copse in. Councilman Norton thought everyone should recognize that Plan X is an experiment for three months, and the results will be taken into account when consideration is given to the permanent improvements in the area. He felt the petitioners were trying to sterilize their street against all traffic. He wished his kids could be insulated against traffic. He felt it was not unreasonable to ask these residents to accept traffic, He thought the church's proposal tae reasonable. Use of their property for the purpose of correcting a mistake, turning around, etc. is a risk, and if they are willing to take that risk for three months, it seems reasonable. He opposed the motion and supported Council's original action. 4/22/74 4 0 0 Councilman Sher felt the action of the Policy and Procedures Committee was clear. The committee voted to approve Plan X, and tae barrier is shown in the middle of the block. The impotent thing at this point is whether the barrier is moved now or. later. Be favors putting the barrier at the corner. He is concerned about the situation through the parking lot. The barrier in the middle of the block makes it difficult for fire equipment to come down Bowdoin. He felt there were many reasons why it should be on the corner, but he did not think it should be done without solving the parking lot problem. Assistant City Manager Charles Walker commented that, staff information at the committee level was that staff would investigate in acre detail and talk about it at the Council meeting. The use permit for the church provides for a minimum of _hirty parking stalls. Presently there are thirtyone. To reverse the direction of the parking stalls to change the flow would result in the elimination of two parking slots or three trees. To reduce parking stalls would cause it to be below minimum required by the use permit. The city cannot require the church to reatripe its parking lot or change the flow. It would establish a precedent for thecity to establish a sign or to place barriers. If Council is concerned about the placement of the barrier at mid -block, the staff would like to propose as an alternate placing the barrier at the other end of the Bowdoin block on a slanted basis something like existed peior to present consideration. That would eliminate the necessity for further turns on the block and eliminate the parkisig lot as a way of getting around the barrier. The problemthat would result in placing a barrier at the corner would require additicnal attention by staff and Council, particularly since the use permit of the church is involved. The motion failed on the following vote: AYES: Henderson, Pearson NOES: Berwald, Clay, Comstock, Norton, Rosenbaum, Sher Recons3ideration of Rehabilitation Pro am Councilman Rosenbaum stated that he would like to move to reconsider the Finance and Public Works committee recosssmendationa.on.the rehabilitation program. The final vote on the committee recommendation was 7 to 1. He noted that he was a amber of the prevailing side on that vote. MOTION: Councilman Rosenbaluzei moved, seconded by HPnderaon that Council reconsider the committee recommendations on the rehabilitat'.sn program. In response to Mayor Comstock, City Attorney Booth stated that such a =often would be appropriate. Councilman Henderson asked if Councilman Rosen.baum were bringing back the entire matter, including 20% lowmoderate income housing. Councilman Rosenbaum replied that he was bringing back the entire committee recommendation. 4/22/74 401 Councilman Berwald recalled that the vote was 4 to 4. Mayor Comstock said it was his understanding that the committee recommendation was defeated, and before it was defeated, a substitute notion was offered which failed 4 to 4. Then the committee recommendation was defeated. That was the motion that Councilman Rosenbaum is bringing up. Obviously, he intends to offer a substitute motion. At this point he is bringing back up the original committee recommendation. Councilman Norton indicated he had a problem like Councilman Berwald had but would not repeat it. The motion to reconsider passed on the following vote: AYES: Comstock, Henderson, Pearson, Rosenbaum, Sher NOES: Berwald, Clay, Norton Mayor Comstock stated the committee's recommendation is now before Council for reconsideration. SUBSTITUTE :.tOIKON: Councilman Rosenbaum moved, seconded by Pearson, the following substitute motion: That the Fire Zone 1 Rehabilitation Program and Financial Plan be referred back to the Finance and Public Works Committee for the purpose of developing the costs and procedures necessary to implement a program containing the following features: 1) The program is to be voluntary. 2) The program is to be limited initially to the rezoned areas of Fire Zone 1. 3) sans are to be made at 32 interest. 4) Loans are to be made to property owners who: a) agree to limit rents b) agree to rent only to those who qualify for housing assistance under criteria to be established by the city. Priority is to be given to current tenants meeting income limitations and to the elderly. Mayor Comstock asked Councilman Rosenbaum if he intended to bring up as a separate action the matter of 202 low —moderate income housing. Councilman Rosenbaum replied affirmatively. Councilman Norton stated that Councilman Beahrs gave him his proxy to vote against this matter, and he would like to record to show that Councilman &eahrs would have voted no if he could have been present. AMENDMENT: Councilman Sher waved, seconded by Pearson,-to.amend the motion by putting a semicolon in place of the final period and adding "and for the purpose of developing a proposal to obtain community opinion and to determine whether there is citizen support for a program involving city financial assistance to facilitate 4/22/74 402 the preservation of housing in neighborhoods bordering the downtown commercial area and to enable the elderly and others needing income limitations to continue to live in Palo Alto." Councilman Sher stated that the whole question of city financial assistance, whether it should be voluntary, the extent to which assistance should be provided, rent limitation, and who should have priorities to move into the units is quite controversial. It is an issue that has the potential for being divisive. There have been many suggestions that it is the kind of program that should not go forward without some attempt to see if there is com- munity support for the program. He said his intention in adding this language is to ask the Finance and Public Works Committee to talk about that matter as well as to get input from staff as to the best way to ascertain whether there is support for this program, and when they report back on the program itself, to report back to Council on the question of ascertaining opinion about the matter. Councilman Norton asked how the Finance Committee is supposed to go about this. As a member of the committee, he did not know how one goes about determining community support. Councilman Sher the plan in the is support. In about the question of support for housing programs of this kind and suggested the possibility of opinion survey, election, forums, HRC participation, etc. The committee would try to determine what would be the best way to ascertain this information. replied that the first job would be to consider proposal, and secondly to determine whether there his State of the City message, Mr. Sipel talked Councilman Norton asked how soon the committee would be expected to take thin up to light of the fact they are involved with the budget. Council ae Sher replied that he would expect the committee to take up the motion and the amendment at the same time. He agreed that the budget has top priority at this time, and it might be awhile before the committee got to this. Councilman Berwald stated that he found this whole proceeding dis- tasteful. He would not make a motion that Council is out of order, because be knew what the vote would be, but he really thought Council was hanging their hat on a technicality. What it is really doing is reinstituting substantatively the subject of rehabilitation which was defeated on a 4 to 4 vote, With all due respect to Councilman Sher's amendment, if Council wants to develop a program to obtain citizen opinion, this is what several hundred citizens walked the streets for getting petitions signed. The way to get opinion is to have an election. Council voted to rescind the ordinance, thereby denying the people who walked with the petitions the right to have an election. Now little by little it is all getting hack on the agenda. He feltit was wrong. HA thought Council should bait a reasonable period of time and get citizen opinion, but not after it had pegged a recommendation back to the Fins+pace Committee with all of the same elements of the rescinded ordinance in it. in response to CounciIiaan Clay, Councilman Sher said that his inten- tion is that the committee would talk about this program with these features, and it would be developed as a proposal to come back to Council. This would be a whole proposal. The matter of the item See p. 420 4/22/74 4 0 3 See p. 494 thae the subject of the petition was only one piece of the pro- posal. It was a first step. It had nothing in it about city finan- cial assistance or priorities for persons who would be eligible to live there. He thought this approach would set forth the total proposal as a matter of policy, and provide an opportunity to see it it would be supported by the community, Councilman Clay stated that he voted against dwelling units in commercial and industrial zones and he will vote against this, because Council is approaching all of this rather piecemeal. There are tvo items on tonight's agenda that somehow are made to appear not to fit together, whereas in fact they do. He felt there were a couple of noticeable absences. While Council sits here talking about low -moderate income housing, the Housing Corporation is conspicuously quiet on taking action to tell the staff and city what it should do. The Housing Corporation is not doing what it was established to do which was to determine how to get low -moderate income housing in Palo Alto. Secondly, the general plan is in process. If Council takes each of these matters separately, it is escalating into something that we cannot call a plan at all. If it continues to escalate .in this fashion, why do we have activity such as is going on now to try to develop a comprehensive plan? All of this sews to b: rather out of order, because Council is not using a reasonable approach to get where it wants to go. Councilman Henderson noted that the Housing C,orpo= ation spoke last week specifically in support of the Rosenbaum motion. He stated that this whole experience concerning Fire Zone I has been the most frustrating experience since he had been on Council. Two years ago there was much talk about preserving existing housing and providing a range of housing opportunities to guarantee a mix of all income levels in Palo Alto. Council passed unanimously various policy statements along these lines for the housing Element of the General Plan. Council sent staff off on a monumental project concerning Fire Zone I, and after many months of staff work, including many public meetings, it received a report that included recommendations and alternatives. Then when it became time to implement the policies, it seemed that some Council members forgot completely their earlier atatemente on housing goals and objectives. The twin subjects of preserving older hams and getting relatively low -moderate income housing for the elderly and young families in Fire Zone I are very complicated. As a result of this complexity, statements are being made by opponents of housing preservation. Council not hearing from the general public. It is hearing from per?lewho are advocates of low -moderate income housing or from people who have special interests in development in the downtown area. Council needs to reach out to the citizenry in general and describe what the suggested program is intended to accomplish and then see what response it gets. Councilman Henderson supported the substitute motion before Council. Councilman Henderson then addressed himself to comments that had been made. He said there was ►got a successful "referendum" in Palo Alto; there was a successful petition to put this rezoning issue on the ballot. To say it is a successful "referendum" would be like saying that the rent control initiative is successful. It won't be unless it is voted in .dune. If the signatures on the rehabilitation ordinance petition indicate a general community opposition to providing housing for the elderly and families with low -moderate income, don't signatures on the rent control initiative petition indicate an equivalent support for such housing? He feltit'was tremendously important to work out a 20Z or sliding 4/22/74 404 scale basis for assuring inclusion of low -moderate income units in all new housing in Palo Alto, including replacement of existing housing in the Fire Zone I area. The motion before Council is not a final decision. It is seeking data relating to a specific program to preserve the structures in the rezoned area of Fire Zone I. When this data comes to committee and Council, he hoped there would be many people giving their comments and suggestions. Also that Council would find the means to inform the general public about the proposed program and have sufficient public input to give Council direction. He said it is up to the committee to find a way to do this. Councilman Sher referred to Councilman Clay's comment this this is out of order in the sense it is piecemeal. He said the comprehen- sive plan will take one and one-half years, and this program was put in the hopper one and one-haif years ago. In that sense the downtown beautification program is piecemeal. It is a city - assisted program just as this is. Certainly this part of the matter is ripe to go forrard, and it was his intention to have the whole financial assistance program before Council. Since this is an issue on which there has been controversy and a difference of opinion, it is important to try to aacereain the public opinion on tha matter. Councilman Clay noted that the rent control issue is going to vote. Pe said he supports low moderate income housing, but he is not in support of any action that has political overtones and which he does not think is going to accomplish what people here say it: will. He recalled that in 1972 the Housing Corporation eat in this chamber and fought for its life against the people who are now fighting for low -moderate income housing. If their will had survived, there would be no Housing Corporation today. Councilman Yeerwald thought the Housing Corporation had a real interest in developing low -moderate income housing. He agreed that Palo Alto did not have a referendum on the rehab ordinance; that Council received a qualified petition. His feeling was that in rescinding the ordinance, Council would take this under consideration for a longer period of time. He said that Mr. Roudrias spoke in favor of some percentage of low -moderate income housing, not 202. The amendment failed on the following vote: AYES: Comstock, Henderson, Pearson, Sher NOES: Berwald, Clay, Norton, Rosenbaum The substitute motion passed on the following vote: AYES: Comstock., Henderson, Pearson, Rosenbaum, Sher NOES: Berwald, Clay, Norton Councilman Rosenbaum noted that the secondpart of the committee recommendation had to do with the question of requiring some percentage of 1ov moderate income housing. The committee recommenda- tion was for the staff to prepare an ordinance. MOTION: Councilman Rosenbaum moved, seconded by Pearson, that the question of requiring some percentage of low -moderate income housing in new construction be re.4,'erred to staff for economic analysis. 4/22/74 405 City Manager Sipel asked when Council would like to get this back. Councilman Rosenbaum said he would like it as soon as possible, but recognized staff priorities. He would hope to have the Finance Committee comee to 3 -rips with this before the end of this budget year so it can appear in next year's budget. He was not sure whether the work required for t'e economic analysis could meet that schedule. Councilman Henderson expressed a preference for seeing it handled as a package rather -than piecemeal. He would hope it could come to the committee at the same time it is looking at the program that is being proposed. Also, because the 2O% figure is currently in the resolution, he would hope to see figures on 20% for five units or more. He would like to see that as well as staff's recommendation in terms of a- slldirg scale. Mr. Sipel doubted that staff could get this back before the first of June. Councilman Henderson did not believe the committee could get to it before that time. Councilman Clay commented that he had never questioned the sincerity of the Housing Corporation. He simply said it is not participating in low -moderate income housing programs as he would expect it to. That may be more Council's fault than the Housing Corporation's. The motion passed on the following vote: AYES: Comstock, Henderson, Pearson, Rosenbaum, Sher NOES: Berwald Clay, Norton SB 1797 Re Licensinst for New Landfill. Sites Vice Mayor Pearson commented that Senator Nejedly had proposed SE 1797 requiring licensing for all new landfill sites, and she would like for staff to prepare a resume and determine whether Council should support it or not. MOTION: Vice Mayor Pearson moved, seconded by Henderson, that staff be directed to research SB 1797 that will require licensing for all landfill sites, Vice Mayor Pearson said she thought it may affect Palo Alto, and she thought it ways important to know what the effect would be. The motion passed on a unanimous voter Ural Communications No one addressed Council under Oral Communications. Ad1our nt The adjourned meeting of April 15, 1974, adjourned at 9:55 p.a. * * * e * * *sea * * * * * * * * * * * * * * * * e * e * * 4/22/74 406 :a. Meeting ofA rim 9�4 The City Councilof the City of Palo Alto met on this date at 9:58 p.nn in a regular meeting with Fiayo_ Comstock presiding. Present: Herwald, Clay, Comstock, Henderson, Norton, Pearson, Rosenbaum, Sher Absent: Beahrs ,Executive Session Council adjourned to executive session from 10:00 to 10:30 p.m. Minutes of ril 1 197 itmat AL There were no corrections to the Minutes of April 1, 1974. Councilman Henderson referred to page 347 8, 1974, first paragraph, fifth line, and noted that "bowdoin" should be spelled "Bowden." of the minutes of April Vice Mayor Pearson made the following corrections: Page 348, seventh paragraph, last ?.ins, insert the word "also" before "deserving." Page 351, tenth paragraph, second line, the word "He" should be "His." Page 354, first paragraph, last line, change the period to a comma and add "provided that the city guarantee the house will not be demolished and will be rented to a low -moderate income. family." Page 356, last paragraph, first line, delete tre remainder of the sentence after "clarified" and insert "in a report to Council the various aethoda of seeking bids." Page 362, last paragraph, teeth line, insert "she knew" after "people" and change the final period to a comma and add "also recognizing that there have been others helped who she did not know." Councilman Sher referred to page 352, and noted that the motion indicates there are two parts, but #1 does not appear. He asked that "(l)" be inserted after "Sher" and "loved" be inserted after "(2)'.° MOTION: Mayor Comstock coved, seconded by Pearson, that the minutes of April 1, 1974, be approved as submitted, and the minutes of April 8, 1974, be approved as revised. The notion passed on a unanimous vote. 4/22/74 4 0 7 Workmen's Compensation Benefits - Ordinance AmendmetA MOTION: Mayor Comstock introduced the following ordinance and moved. seconded by Pearson, its adoption: ORDINANCE NO. 2184 ENTITLED "ORDINANCE OF THE COUNCIL OF THE CITY OF PALO ALTO AMENDING SECTION 2.24.140 OF THE PALO ALTO MUNICIPAL CODE RELATING TO TEMPORARY DISABILITY PAYMENTS" (first reading April 8, 1974) The ordinance was adopted on a unanimous vote. lawn Bowls Clubhouse Lease (CMR:278:4) Mr. Harold Kay, 576 Hale Street, thanked the City Manager and Council for their support of the lease. He gave a brief history of the sport of bowling and of the bowling green in Palo Alto. He stated that his organization planned to try to attract younger blood. He invited Council members and the public to came to the bowling green for relaxation and extended sincere appreciation for the spirit of cooperation on the part of the City Manager, staff, and Council. MOTION: Vice Mayor Pearson roved, seconded by Norton, that the Mayor be authorized to execute the lease on behalf of the City Council. The motion passed on a unanimous vote. AcGuisitian of land for Greer Park axis :.4) MOTION: Councilman Bezwaid moved, seconded by Pearson, that this item be referred to the Finance and Public Works Committee. Mayor Comstock asked about an alternative which would be a referral of all except the first portion and Council simply directing the City Manager to go ahead and acquire the lane!. He asked how rapidly the city is faced with the necessity to act end how that related to what would be a likely timetable for review by the Finance end Public Works Committee. Me wondered if there were some pressure. City Manager Sipel did not think there was an mediate pressure. To staff's knowledge there is no development plan for any of the land. He hoped for some action by Council in the next three to four months. Perhaps Council can review the landbanki.ng report staff is preparing which will give a better perspective in which to judge this particular proposal. Mr. Sipelsaid that if there should be a change in the status of any of the properties, he would let Council or the committee know. In response to Mayor Comstock, Councilman Henderson said that the Finance and Public Works Committee will be discussing both the Greer Park praposa1 in the CIP and what may he cawing to it as a iandbanking proposal, He would anticipate the committee would take both of those items up on the second round of the CIP which would be probably early in June. 4/22/74 408 Mr. Sipel commented that there are some budgetary questions, and if Council wants to make an appropriation, the best time would be during June. Councilman Henderson eomnmented that the availability of landbanking funds will not be known until the eoaaiittee considers both subjects. Mayor Comstock stated that he would be watching the matter clesely. He did not want too much time to go by without action. Steve Sepersteiu, 3072 Stelling Drive, said the residents would like to have the Greer Park Improvement Program referred to the Finance and Public Works Committee. The proposal meets the needs as seen by the residents' association. The referral motion passed on a unaniuoue vote. Old Ponce/Fire Buildin : lease of mw Mayor Comstock announced that Council had received a report from the City Manager with a copy of the proposed lease recommending approval of lease agreements with the primary lessee and with the organizations who will use the community space. The recommended ctioai required approval of both leases. Councilman Henerson asked if it were necessary to declare a specific rental figure. What about putting it in words such as "rental to he paid at a race equal to the average of other rentals in the building as of the date our lease begins." He said he was bothered by tie figure of $1.10 per square foot when we were talking about 35: for the second floor and a little more for the first floor. Be wondered if some of the problems might be alleviated by not declaring a specific amount at this point. John Zellhoefsr, property management consultant, said that the rental rate that is to be established for the building is presumed to be $1.10 per square foot for the entire building. On the premise that the building will be leased out at $1.10 per square foot and all of the space going at the same rate, it is necessary for someone to be the first tenant to be signed up. In this case, it has to be the lessees of the 1,200 square feet, because the floor plan has to be approved by Council before Mr. Nieto can get other tenants and financing. 1e noted that the lease was written so that the first eight months of the lease carry no rent per se, and it averages out to slightly legs than 70c a square foot. Build -out costa are not associated with this lease. Build - out costs are common in most commercial and office spaces where you lease premises, i.e., you lease bulk space and are responsible for other improvements. Staff tried to avoid this kind of variable and alao tried to build in a hedge in case the rent does not come out at $1.10 a square foot. For the first two years, the city is In a pretty good position, because it is paying a net rental of leas than 70c a square foot. He said that starting the lease without a rent terse would wean you would not have a lease, and it might present some serious problems with financing. A master lessee needs rental commitment for financing purposea. 4/22/74 4 0 9 M4r. Sipel pointed out the $1.10 is relative to the type of development Mr. Nieto is trying to create and is not representative of the cost to lease a similar kind of apace in another facility. There is rental space in the downtown area which could be obtained at less cost, but in the type of development being created in this building, this appears to be the going rate. When the lease expires, we will have a better idea' whether $1.10 is the gong rate and can change it if it is not. MOTION: Councilman Henderson moved, seconded by Pearson, that Council approve the lease agreement with Le Casa de Nieto and authorize the Mayor to execute the lease. Councilman Rosenbaum stated that the more he has thought a'eout this, the more he feels the city has been taken. Council adopted a procedure of leasing all the space to Mr. Nieto and getting it back on the assumption the rents would be some number in the range from 30c to 65e. Now Council is told that in places as far away as Santa Barbara rente are $1.10 per square foot. There is no reason Council cou1a not have had this information three months ago, and probably would not have agreed to go ahead with this procedure. It is ridiculous to rent space for community organizations at $1.10 a square foot. It has been mitigated over the two-year period, but what happens at the end of the two years? The city will have to throw them out, because Council will not spend $1.10 a square foot. A year ago when Per. Nieto spas writing to Mr. Fourcroy, he said while he was confident [Le space woulcl bring 50e a square foot on the commercial market, he would be willing to rent it to the city at 50X of thst va`ae. Councilman Rosenbaum said he objects to spending $1.10 and asked staff what recourse Council has to attempt to negotiate some other figure. Mr. Sipel replied that the figure vas developed in discussions with staff and representatives of Mr. Nieto. The last time this was discussed on February 25, 1974, 2t. Sipel indicated to Council the total subsidy would be somewhere in the area of $5,000 to $13,000 per year, depending on location of space and degree to which the area had been finished. There was an assumption it would be at market value. He did not feel it was any secret that the city was leasing prim space for a community r use and that the same apace could be obtained somewhere else for half the price. It was Council's desire to put some community activities iu that building. Purely on a coat basis, Mr. Sipel said he would not recommend it, but there were some overriding reasons why it was done. Specific development of the facility is new much clearer than it vas in February, and $1.10 per .square foot is the figure staff has been able to negotiate. Council has the opportunity of saying it does not want to exercise the option for the time being. Councilman Rosenbaum said he did not have in mind rejecting the community use of 1,200 square feet, but he asked Nr. Sipel's reaction to staff's renegotiating the price on the order of 55C a square foot. Mr. Sipel replied that staff had had full negotiations with Mr. Nietoandfelt they had made the beat deal they could get. There is some time bind on the financing, and some decision is necessary for financing to fall into the time schedule that was provided in the earlier agreement, 4/22/74 4 1 0 Mr. Richard Nieto 951 Dennis Drive, stated that a year ago the building was unsure and so was the fact of community use and where the community use would be located. There was no way to plan the rest of the building without knowing that. He agreed that the rent had gone up, but he had no control on the economy. He said he was trying to take the best possible attitude, giving the area that is best in the building for community use. He has Asked his realtors to negotiate only dollar leases --no percentage income leases. Using the build -out method, $12,000 would be the requirement to put that space in condition for use. He showed a drawing depicting the best community use that they found. He said he must have a decision as to whether Council did not want community space, and if it is wanted, where it would be. Councilman Rosenbaum, said that the issue tonight was not where the space is to be. If Council had known it was going to be on the first floor, they might have acted differently at an earlier time. He said he was not happy with it. Mr. Nieto mentioned the city gets 52 of the income. He gets 95%. The city's net revenue is supposed to be $35,000 to $40,000. The city is in the position of paying Mr. Nieto back $13,000 right off the bat for 1,200 square feet if we continue beyond the two --year period. It was not the Council's intention to rent the community space for two years and drop it.. SUBSTITUTE MOTION; Councilman Rosenbaum moved, seconded by Berwald, that staff be directed to negotiate the lease to provide for reeta? of 55C per. square foot, such rent to commence when the facilities are ready for occupancy. In response to Mayor Comstock, Mr. Sipel stated that Council should not take action on the lease with Resource Curter. for Women and Our Health Center until the city has secured the lease from Mr. Nieto. Hr. Sipel further stated that he was not prepared to recommane the; suggestion by Councilman Rosenbaum, because it will coat the city more than the recommendation that was before Council. Mir. Zellhoefer explained tit in its present form, the lease works out to $1.10 per square foot for the months the city pays the rent, or 73c for the total twenty-four months. The city gets back 5% of that, leaving a net cost of 69c a square foot less the 10c a square foot that the two organizations would be paying the city. This leaves a net cost to the city of 59C+ per square foot per month. Councilman Rosenbaum's suggestion of 55C a square foot plus build -out costs that would, require $10 a square foot, squall $500 per month or 41.6 a square foot plus 55c. This is 96.6 less the 5Z which equals 91.7t less 10c is 81.7c cost. Therefore, it would cost approximately 22c a square foot more with the city's paying the build -out costs. Councilman Roaeabaum stated that if you look beyond the two yearn, it becomes cheaper for the city to pay some initial costs. Mr. zell.hoefer said,that if the building does generate the $1.10 per square foot revenue, then the city`s income is also going to be greatly increased, because the 1,200 square feet is a very ai all _portion. The income projections will turn out to be conservative, the net :eeult`s being it may cost the city more for the 1,200 square feet. but the city will recapture that .and more in increased revenues for the building. 4/22/74 4 1 1 Councilman Rosenbaum said he w..uld question that because of the 95-5 split, but he agreed this would be a sales tool for Mr. Nieto. Mr. Zellhoefer stated that it is a situation that has existed in the past for similar type buildings such as C1d Town, the store on Ramona Street, and other similar ventures. Councilman Clay stated that he would also object to the $1.10 figure. Be could not see how a rental figure of $1.10 for rental space downtown could be predicted in the next couple of years. Even if it is, he would not favor the city's establishing that market which it would be doing by entering into this agreement. He asked if Mr. Nieto's financing were based on renting the space for $1.10 per square foot. Mr. Nieto replied that the financing is based on the restaurant only. Re has to prove his financing ability on what he can do, not his tenants. He said that if the city would agree to take the space at whatever the market rate is in September, that would be fine. Councilman Clay said he would not care what the market was, he would not ply $1..10 for it, Mr. Nieto remarked that this is office space in a commercial buildin , and there is no parallel for this. Councilman Norton asked when the city would begin to receive rent from La Casa de Nieto, and Mr. Sipel informed hies that it would be January 1, 1975. Councilman Norton noted that in paragraph 3 of the proposed lease that upon execution of this lease the city promptly pays Mr. Nieto $3,040. He thought it,was out of order for the city to pay the lessee $3,000, when the city does not expect to receive rent from him for another seven, months. He asked if this were another method of assisting in the financing of the restaurant. Mr. Sipel replied that the lease between the city and the Lai Casa de Nieto also required an initial payment of $2,500 to be credited as rent. This is not such different from the reverse procedure we have now where the lessee becomes lessor, and the city becomes sublessee. There is the additional payment in there of $400 that provides for additional walls to be built for a portion of the space. That is an initial capital expense of the city at the commencement of the lease that will be returned over the twenty -- four --month period by the two organizations. Councilman Norton questioned whether the city, eight months in advanee of getting anything in return, should advance any moneie into this, Councilman Sher recalled that Councilman Rosenbaum quoted earlier statements made when this was in the formative stage, one of which was that Mr. Nieto was prepared to let the city have this space at 502 of market rental. He asked what happened to that commitment. Hr. Nieto replied that the letter was quoted only partially. That offer was if the city would take the entire second floor and would build it out themselves. At that time it did not seem like Council wanted to take 5,000 square feet in that building. 4/22/74 412 Councilman Rosenbaum agreed that the letter did state the offer was for the entire area, but the build -out was not mentioned. Councilman Sher asked for an explanation of the underlying reason for a rental which figures out to $1.10 per square foot, but none to be collected during the first eight months. Mr. lellhoefer said that the $1.10 per square foot is presumed to be the newly -established rental rate for all space in this building as established by the market in other eituations for space of a similar type. By waiving the rent for the first eight months, it is the city's hedge if that market rate does not become a reality. With that factor in there, the city can average the rent over the twenty -four -month period and at the end see whether or not it was achieved. If not, then the city will not have paid more than the going rate, assuming the rate is at least 70c a square foot. Councilman Sher said that in reality this arrangement means that Mr. Nieto is prepared to lease this public --pace to the city for 70c per square foot for the first two-year period. He asked why not beyond that. Zellhoefer replied that the market may not be the same. There is a reasonable chance inflation will continue. Councilman Sher felt that a better way to achieve what Councilman Rosenbaum was after would be to go to clause 15 which deals with options for renewal. He suggested the city should have the right of first refusal to lease the premises at 50% of the fair market rental. He stated that Council would not do the Women's Resource Center or Our Health Center any favor by going ahead on this basis at this 'nice, knowing full well that at the end of the two-year period the city will not be able to let them have the space at that subsidized rate, and they will have to leave. He said he was not prepared now or ever to have the city pay $1,10 per square foot and turn around and let the organizations rent it for 10C. He said he would support the motion, but he would prefer to see 50% of fair market value in clause 15. Councilman Henderson noted that under the current proposal the city would pay Mr. Nieto $17,280; under the Rosenbaum proposal, it would come to $15,840. The difference is insignificant. However, he felt that a special rate to the city could be justified. It is an establishment of office space in this facility. He said he would support Councilman Rosenbaum's motion but would propose an as er_dment . AMENDMENT: Councilman Henderson moved, seconded by Pearson, to amend the substitute motion to add an amendment to the lease under Section 15, Options, as follows. The city shall have the right of first refusal to lease the subject premises for an additional term or terms, and at 50Z of the fair marked: rental rates as estdb- l.ished by comparison of the rental changed for the remainder of the building. Councilman Henderson said that the first two-year period, but Mr. Nieto and the city somehow possible. He thought this was time of the lease. means we leave the rental alone for the right of renewal is based on sharing in making this public use the way it should be for the full 4/22/74 4 1 3 Councilman Berwald stated he thought the city should pay Mr. Nieto a fair market rent. He thought that leasing this public space and subsidizing it constituted an illegal gift of public funds. The previous city attorney ruled on that on more than one occasion in somewhat similar situations. He questioned the process by which the city arrived at which two organizations would be chosen. Ha said they are very narrow spectrum groups compared to others. The criteria established by staff were not used in determining who should get the lease on this space. He said he would oppose the lease on those grounds. Councilman Clay stated that he did not accept $1.10 as fair market value. The original agreement was for 50% of fair market value. Mr. Nieto replied that that was for the entire second floor and $10 a square foot build -out. He said he was still perfectly willing to do that. He pointed out that it would require a change in plans. We have finally agreed on a community use. All sides are happy, Hy has gone to architectural t.xpense, Extensive meetings have been held. Negotiations can continue, but the whole key is fair market value. He did not establish it. It has kept creeping up. He said that downtown beautification has almost doubled the commercial rents. Vice Mayor i'ear,3on asked the City Attorney whether or not subsidizing the community space is an illegal use of public funds. City Attorney Booth replied that there are other community groups that use public buildings, such as the lawn bowoling group, the Red Cross, Boy Scouts, and Veterans. He did not believe it was an illegal use of public funds. From th_ materials he has examined, it appears the groups are engaged in public services that the city could operate itself if it chose to do so. AMENDMENT RESTATED: Councilman Henderson, with the approval of Pearson, reworded the amendment to read as fellows: City shall have the right of first refusal to lease the subject premises for an additional term or term, and at 50% of the fair market rental rates as established by comparison of the rental charged for the rented portions of the rezudader of the building. The amendment passed on the following vote: AYES: Clay, Comstock, Henderson, Pearson, Rosenbaum, Sher NOES: Berwald, Norton C uncilnen Roaenhaua commented that Mr. Sipel had pointed out that the negotiations have to be made tonight. He said that would imply that his moticu should be an amendment to the lease agreement, and there is a presumption that Mr. Nieto is going to be agreeable to Chia. SUBSTITUTE MOTION WITHDRAWN: Councilman Rosenbaum withdrew the substitute motion in order to propose an amendment. AME NT: Councilman Rosenbaum moved, seconded by Berwald, to amend Section 3, Rent, to provide 5Ss/8q. ft. per month for 1,200 sq. ft. for twenty-four smooths, beginning when the facility is ready for occupancy and retention of Pour Hundred Dollars ($400) for three interior wae'la, six feat high, to be constructed by Lessor as shown in red on the attached Exhibit "A." 4/22/74 4 1 4 City Manager Sipel pointed out that Council should know what is likely to happen if they vote positively on the motion. It is likely that Mr. Nieto will not accept the lease in this fora. If that happens, there is a provision in the matter lease for arbitration. Conceivably the matter could be resolved in that way. There may be some other legal problems, however. The amendment passed on the following vote: AYES: Comstock, Henderson, Norton, Pearson, Rosenbaum, Sher NOES: Berwald, Clay, Norton The lease as amended was approved on the following vote: AYES: Comatock, Henderson, Norton, Pearson, Rosenbaum, Sher NOES: &erwald, Clay, Norton Mayor Comstock stated that Council would defer action on the leases with the two organizations until there is some resolution of this lease. Motion to Continue MOTION: Mayor Comstock moved, duly seconded, that the meeting be continued to 7:30 p.m. Noonday', April 29. Councilman Henderson objected co scheduling a meeting for the fifth Monday night of the month. He felt Council should honor the three respites a year. The motion failed on the following vote: AYES: Berwald, Clay, Comstock, Norton NOES: Henderson, Pearson, Rosenbaum, Sher Mayor Comstock asked Vice Mayor Pearson to take the chair, and. Mayor Comstock left the meeting at 11:45 p.m. and did not return. Unit y House: Repo r t and Contract Vice Mayor Pearson presiding. Car:.ee ri isedwef l reviewed the staff report. MOTION: Councilman Henderson moved, seconded by Pearson, that Council enact the third amendment to agreement, Palo Alto Community Drug Abuse Board, Contract No. 3454. Councilman Norton stated that he wished to clarify what he had in mind for the audit on page 5 of the staff report so there could be no question. 4/22/74 4 1 5 AMENDMENT Councilman Norton moved, seconded by Berwa_'d, that the "independent" audit referred to by staff on page 5 of the report be an in --depth and completely objective investigation and report with a view to providing the City Council all of the information it needs to intelligently determine how the city's money has been spent to date. Councilman Sher asked staff if this amendment incorporates what staff's intention was in suggesting the audit. Mr. Walker replied that staff had contemplated the same type of audit that is currently conducted on city expenditures. Staff would expect the auditors to use the same procedures as are used for any city department. Councilman Sher asked Councilman Norton if that woui.: satisfy his motion, and Councilman Norton replied negatively. Councilman Berwald commented that on April 8, he made a motion that a series of analytical work :steps be taken which would accui.ulativs.ly enable Council to at -lye et a judgment regarding renegotiating the contract. Except for Mrs. dwell's comment that Council might want co have a report on the drug abuse situation and necessity to spend funds, there was no supi or t for his not! on by Council or staff. While Council was not wining to authorize the analysis necessary to make a rational decision, he assumed it was willing tonight to entertain .a major contract amendment without knowing any- thing except that Unity House has been closed, and now Co,sncil is going to legitimize the closure by letting PACDAB get out from under the contract by making this amendment. He disapproved of this procedure. PACDAB would not be in breach of the contract if this is done. It is a cute way of letting them off the hook. He thought Council should go ahead with the analytical steps he suggested, and at the end of their regular contract on the basis of information Council will have, the change can be made. He was sot at all in favor of doing this at this time. Vice Mayor Pearson said it was her understanding that this action would close Unity House for the remainder of the year, and when a new contract is negotiated, there is a possibility of a new RTC. Mr. Wal.kes agreed that this mould, in effect, remove the Laity House program from the contract for the remainder of the fiscal year. It does not preclude any decisions about future use of that facility. Councilman Henderson stated that it makes no sense to continue in effect a contract that is inoperable. A decision has been made to close Unity house, and the contract still h..a two months to go. It makes sense to sake the changes and move the $35,000 back into the general fund. If the majority of Council wants to reopen Unity House, they will have the opportunity in July. Councilman Clay referred to the summary paragraph in the staff report. He said that summary implies to lid that Unity House should not be closed, because it says that residential care facilities often have extremely difficult first years. That is followed by saying PACDAB has acted in good faith. At the last meeting, the 4/22/74 4 1.6 i statement was made by one of the supporters of the program that to close Unity House raises a question as to the continuation of the drug program having critical mass. Without Unity House do you have a drug program that makes any sense. He felt Unity House should be continued, or Council should consider ell of the drug program. It should not separate one from the other. He said hecould not agree or support the conclusions that had been made. Vice Mayor Pearson stated that the main motion would be voted on; then the Norton amendment would be taken up separately as another notion. The motion to enact the third amendment to the agreement failed on the following vote: (5 votes required) AYES: Henderson, Pearson, Rosenbaum, Sher NOES: l rwald, Clay ABSTAIN: Norton MOTION: Councilman Norton moved, seconded by Berwaid, that the "independent" audit referred to by staff on page 5 of the report be an in-depth and completely objective investigation and report with a view to providing the City Council all of the information it needs to intelligently determine how the city's money has been spent to date. City Manager Sipel stated that if this motion passes, it would be his intention to bring back the scope of services for the Council's review so everyone understands what it is the auditor would do prior to his embarking on the work. Councilman Henderson commented that there were connotations here he did not like. Staff is saying they are planning to call in an auditing firm. Council is implying they would not come in and do a deep audit, or secondly, they are being asked to do more than they ordinarily would do in auditing the city's status. He did not know why such connotations needed to be put on anyone. Joel Davidson, 2130 Harvard, a PACDAB member, said it seemed to him. Council had not read up on drug programs or residential treatment centers. It takes more than sa year to establish a success- ful program. It is a struggle constantly. Programs fail and close down and then they come back again. PACDAB was hoping to diacusss the problem and come up with a more sensible program. Lincoln Mitchell, 285 Hamilton, a PACDAB member, said 1:hat the contract amendment Council Just voted dots is the same amendment it passed on April 8; consequently, the action is inconsistent. PACW.B's action in cic,sing Unity House was responsible. What Council has done is left WCCDAB with a house they are not using. PACDAB felt the contract aeould be amended to reflect the actual fasts. He said there is no question now thet PACDAB is in breach of the contract. Council can suspend it. He asked Council to reconsider the lest vote. 4/22/74 4 1 7 See p. 445 The motion passed on the following vote: AYES: Berwald, Clay, Norton, Pearson, Sher NOES: Henderson, Rosenbaum Senile ���Sewer Easewent , �sTg to , a n ta. ~ Dist:. ict MOTION: Vice Mayor Pearson introduced the following ordinance and moved, seconded by Henderson, its approval for first reading: "ORDINANCE OF THE COUNCIL OF THE CITY OF PALO ALTO APPROVING AN AGREEMENT TO RELOCATE A SANITARY SEWER EASEMENT OF THE EAST PALO ALTO SANITARY DISTRICT" The ordinance was approved on a unanimous vote. Request Lon Develo Went of Cast Esti�iatea 'fie rent Contro Councilman Clay stated he felt the item itself described what he was asking for; therefore, he did not submit a written explanation. MOTION: Councilman Clay moved, duly seconded, that Council direct staff to develop staffing, administrative and legal cost estimates to implement Rent Control in the event the charter amendment initiative is successful, so that provision: for these coats can be grade in the 1974-75 budget now under study; and that such estimate be developed by May 27, 1974. Councilman Clay asked whether or not that gave staff a reasonable amount of time. Mr. Sil;ea, agreed that it would be sufficient with the condition that what staff develops is going to be fairly general in nature. They will be looking at programs that are in existence in other communities and will have to depend on the mail rather than other techniques. Councilman Henderson said that the way this was worded, it appeared to be an in-depth study. Ha said he was willing to support a rough estimate type of figure. Councilman Sher asked how this provision would be made in the budget. Would it be by including some kind of contingent figures? Mr. Sipel replied that, would be one way. Another would be a budget amendment. His guess would be there would not be a substantial figure in 1974-75, but the bulk would come the following year and continue. The thrust will he what the coat will be after such a program is underway. Frank Manfredi, 219 Addison, said why waste staff time on something that may not occur. He said this is a ploy by Palo Alto '74. Their idea is to go back to the people and say rent controls will cost so much and break us. 4/22/74 4 1-$ The motion passed on the following vote: AYES: Berwald, Clay, Norton, Rosenbaum, Sher NOES: Henderson, Pearson Oral Communications No one addressed Council under Oral Communications. 'Adjournment The meeting adjourned at 12:15 a.m. ATTEST : -o. City C3e City Cl APPROVE: Mayor Vice :"mayor 4/22/74 4 / 9