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HomeMy WebLinkAbout2017-03-29 Planning & transportation commission Agenda Packet_______________________ 1.Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson’s presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non-speaking members agree not to speak individually. 2.The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3.The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. Planning & Transportation Commission Regular Meeting Agenda: March 29, 2017 Council Chambers 250 Hamilton Avenue 6:00 PM Call to Order / Roll Call Oral Communications The public may speak to any item not on the agenda. Three (3) minutes per speaker.1,2 Agenda Changes, Additions, and Deletions The Chair or Commission majority may modify the agenda order to improve meeting management. City Official Reports 1.Assistant Directors Report, Meeting Schedule and Assignments Action Items Public Comment is Permitted. Applicants/Appellant Teams: Fifteen (15) minutes, plus three (3) minutes rebuttal. All others: Five (5) minutes per speaker.1,3 2.Public Hearing: Review and Comment on the Supplemental Draft Environmental Impact Report & Discussion of the Commission's Process for Reviewing the Revised Draft Plan Following Review by the Citizens Advisory Committee and the City Council Study Session Public Comment is Permitted. Five (5) minutes per speaker.1,3 3.Discussion and Comments for City Council Consideration Regarding Development of an Ordinance to Perpetuate an Annual Limit on Office/R&D Development Following Expiration of Interim Ordinance #5357 Restricting Such Land Uses in Certain Parts of the City to 50,000 Square Feet per Year. Environmental Analysis: This Discussion is not a Project Pursuant to the California Environmental Quality Act (CEQA). For More Information, Please Contact Clare Campbell at clare.campbell@cityofpaloalto.org. Approval of Minutes Public Comment is Permitted. Five (5) minutes per speaker.1,3 4.March 8, 2017 Planning & Transportation Commission Meeting MinutesMarch 8 Draft Minutes _______________________ 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson’s presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non-speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. Committee Items Commissioner Questions, Comments or Announcements Adjournment _______________________ 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson’s presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non-speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. Palo Alto Planning & Transportation Commission Commissioner Biographies, Present and Archived Agendas and Reports are available online: http://www.cityofpaloalto.org/gov/boards/ptc/default.asp. The PTC Commission members are: Chair Michael Alcheck Vice Chair Asher Waldfogel Commissioner Przemek Gardias Commissioner Ed Lauing Commissioner Susan Monk Commissioner Eric Rosenblum Commissioner Doria Summa Get Informed and Be Engaged! View online: http://midpenmedia.org/category/government/city-of-palo-alto or on Channel 26. Show up and speak. Public comment is encouraged. Please complete a speaker request card located on the table at the entrance to the Council Chambers and deliver it to the Commission Secretary prior to discussion of the item. Write to us. Email the PTC at: Planning.Commission@CityofPaloAlto.org. Letters can be delivered to the Planning & Community Environment Department, 5th floor, City Hall, 250 Hamilton Avenue, Palo Alto, CA 94301. Comments received by 2:00 PM two Tuesdays preceding the meeting date will be included in the agenda packet. Comments received afterward through 2:00 PM the day of the meeting will be presented to the Commission at the dais. Material related to an item on this agenda submitted to the PTC after distribution of the agenda packet is available for public inspection at the address above. Americans with Disability Act (ADA) It is the policy of the City of Palo Alto to offer its public programs, services and meetings in a manner that is readily accessible to all. Persons with disabilities who require materials in an appropriate alternative format or who require auxiliary aids to access City meetings, programs, or services may contact the City’s ADA Coordinator at (650) 329-2550 (voice) or by emailing ada@cityofpaloalto.org. Requests for assistance or accommodations must be submitted at least 24 hours in advance of the meeting, program, or service. Planning & Transportation Commission Staff Report (ID # 7751) Report Type: City Official Reports Meeting Date: 3/29/2017 City of Palo Alto Planning & Community Environment 250 Hamilton Avenue Palo Alto, CA 94301 (650) 329-2442 Summary Title: City Official Report Title: Assistant Directors Report, Meeting Schedule and Assignments From: Hillary Gitelman Recommendation Staff recommends that the Planning and Transportation Commission (PTC) review and comment as appropriate. Background This document includes the following items:  PTC Meeting Schedule  PTC Representative to City Council (Rotational Assignments)  Tentative Future Agenda Commissioners are encouraged to contact Yolanda Cervantes (Yolanda.Cervantes@CityofPaloAlto.org) of any planned absences one month in advance, if possible, to ensure availability of a PTC quorum. PTC Representative to City Council is a rotational assignment where the designated commissioner represents the PTC’s affirmative and dissenting perspectives to Council for quasi- judicial and legislative matters. Representatives are encouraged to review the City Council agendas (http://www.cityofpaloalto.org/gov/agendas/council.asp) for the months of their respective assignments to verify if attendance is needed or contact staff. Prior PTC meetings are available online at http://midpenmedia.org/category/government/city-of-palo-alto/boards- and-commissions/planning-and-transportation-commission. The Tentative Future Agenda provides a summary of upcoming projects or discussion items. Attachments:  Attachment A 3-29-17 2017 PTC Meeting Schedule & Assignments (DOCX) Planning & Transportation Commission 2017 Meeting Schedule & Assignments 2017 Schedule Meeting Dates Time Location Status Planned Absences 1/11/2017 6:00 PM Council Chambers Regular 1/25/2017 6:00 PM Council Chambers Regular CANCELLED 2/8/2017 6:00 PM Council Chambers Regular Waldfogel 2/22/2017 6:00 PM Council Chambers Regular 3/8/2017 6:00 PM Council Chambers Regular Monk, Waldfogel 3/29/2017 6:00 PM Council Chambers Regular 4/12/2017 6:00 PM Council Chambers Regular 4/26/2017 6:00 PM Council Chambers Regular 5/10/2017 6:00 PM Council Chambers Regular 5/31/2017 6:00PM Council Chambers Regular 6/14/2017 6:00 PM Council Chambers Regular 6/28/2017 6:00 PM Council Chambers Regular 7/12/2017 6:00 PM Council Chambers Regular 7/26/2017 6:00 PM Council Chambers Regular 8/09/2017 6:00 PM Council Chambers Regular 8/30/2017 6:00 PM Council Chambers Regular 9/13/2017 6:00 PM Council Chambers Regular 9/27/2017 6:00 PM Council Chambers Regular 10/11/2017 6:00 PM Council Chambers Regular 10/25/2017 6:00 PM Council Chambers Regular 11/08/2017 6:00 PM Council Chambers Regular 11/29/2017 6:00 PM Council Chambers Regular Subject to Cancellation 12/13/2017 6:00 PM Council Chambers Regular 12/27/2017 6:00 PM Council Chambers CANCELLED 2017 Assignments - Council Representation (primary/backup) January February March April May June Michael Alcheck Eric Rosenblum Asher Waldfogel Ed Lauing Przemek Gardias Eric Rosenblum July August September October November December Asher Waldfogel Ed Lauing Doria Summa Przemek Gardias Doria Summa Michael Alcheck Subcommittees Comp Plan CAC: Planning & Transportation Commission 2017 Tentative Future Agenda The Following Items are Tentative and Subject to Change: Meeting: April 12 Doc ID Short Title Placement 7540 Comp Plan Summary Update Study Session 7891 Menlo Park and Mountain View Bayfront DEIR Comment Letters Study Session 7906 Scoping Meeting: 250 and 350 Sherman Ave Public Safety Building and Parking Structure Study Session Planning & Transportation Commission Staff Report (ID # 7792) Report Type: Action Items Meeting Date: 3/29/2017 City of Palo Alto Planning & Community Environment 250 Hamilton Avenue Palo Alto, CA 94301 (650) 329-2442 Summary Title: Comp Plan Update: Supplement to Draft EIR Title: Public Hearing: Review and Comment on the Supplemental Draft Environmental Impact Report & Discussion of the Commission's Process for Reviewing the Revised Draft Plan Following Review by the Citizens Advisory Committee and the City Council From: Hillary Gitelman Recommendation Staff recommends the Planning and Transportation Commission (PTC) take the following actions: 1. Conduct a public hearing to receive comments on the February 10, 2017 Supplement to the Draft Environmental Impact Report, together with the February 2016 Draft EIR, consistent with the notice provided in Attachment A; and 2. Identify the process by which the Commission will evaluate and provide its input to the City Council on the Draft Comprehensive Plan Update currently being developed by the Citizens Advisory Committee (CAC) and the City Council. (Staff expects that the draft will be forwarded to the Commission for review this summer.) Executive Summary On February 5, 2016 the City published a Draft EIR (referred to as the “February 2016 Draft EIR”) that analyzed four high-level scenarios at an equal level of detail in order to assess potential impacts of the Comprehensive Plan Update. A related fiscal study was also prepared. The City Council subsequently directed City staff to analyze two additional scenarios in order to broaden the range of potential outcomes and provide additional information to inform the planning process. These additional scenarios are described and analyzed as Scenario 5 and Scenario 6 in a Supplement to the Draft EIR, published on February 10, 2017 and which can be found at the following link: (http://www.paloaltocompplan.org/eir/). The Executive Summary in City of Palo Alto Planning & Community Environment Department Page 2 Chapter One provides an overview and the matrix in Attachment B summarizes quantitative conclusions of the analysis. A revised fiscal study is also available and can be found at this link: http://www.paloaltocompplan.org/wp- content/uploads/2017/02/CompPlanFiscalStudySupplement_2.16.17_FINAL.pdf. The Supplement to the Draft EIR focuses on the new analysis pertaining to Scenarios 5 and 6 and does not reproduce all of the information from the February 2016 Draft EIR. The Supplement to the Draft EIR includes information from the February 2016 Draft EIR where the information has been revised or where it is crucial to understanding the analysis of Scenarios 5 and 6, and comments on the February 2016 Draft EIR are also being accepted during the circulation period for the Supplement. The primary purpose of this evening’s meeting is to conduct a public hearing to solicit public comments regarding the Supplement to the Draft EIR. Comments on the associated fiscal study and the February 2016 Draft EIR are also welcome. Written comments are also being accepted until the close of business on March 31, 2017. All substantive comments received on the EIR, whether at the public hearing or in writing, including the comments received on the February 2016 Draft EIR, will be responded to in the Final EIR rather than at the public hearing this evening. The other purpose of this evening’s meeting is to have a discussion about ways the PTC can structure its review of the draft of the Comprehensive Plan Update that is being prepared by the Comp Plan Citizens Advisory Committee (CAC) and reviewed by the City Council. This work was based in part on the PTC’s April 2014 draft, and the PTC’s re-review is expected to commence this summer and to include multiple public hearings. Later in this report, staff has provided some options for the PTC’s consideration. Also, the section of the Palo Alto Municipal Code outlining the PTC’s considerable role in the Comp Plan adoption and implementation has been provided as Attachment C. Background The 1998-2010 Palo Alto Comp Plan contains the City’s official policies on land use and community design, transportation, housing, the natural environment, business and economics, community services, and governance. The Comp Plan provides the basis for the City’s development regulations and the foundation for its capital improvement program. An update of the Comp Plan was initiated by the City Council in 2006. In 2014, the Council received the Planning & Transportation Commission’s (PTC’s) suggested revisions and endorsed a new framework for the planning process to include broad community engagement, discussion, and analysis of alternative futures, cumulative impacts, and mitigation strategies. A community “summit” was held in mid-2015, and a Citizens Advisory Committee (CAC) was formed to make recommendations to the City Council on policies and programs for inclusion in the update. City of Palo Alto Planning & Community Environment Department Page 3 Since 2014, the City Council has provided guidance on the vision and goals for each element of the Comp Plan Update, and the CAC has completed its review and recommendations regarding all of the chapters or “elements” of the plan. The City Council is now in the process of reviewing the CAC’s work, and providing their input on plan revisions to city staff and consultants. A final Comprehensive Plan Update cannot be adopted until the City complies with CEQA, which is a State law that requires California agencies to identify the significant environmental impacts of their actions and describe feasible measures that can be taken to avoid or mitigate those impacts. An EIR is used to evaluate a proposed project’s potential impacts on the environment, and recommend mitigation measures or alternatives to reduce or eliminate those impacts. The City has prepared what is referred to as a “program-level” EIR (CEQA Guidelines Section 15168), which assesses the potential cumulative impacts of development that may occur during the life of the plan, considers potential alternatives, and identifies mitigation measures that should be adopted to reduce or avoid significant impacts. This is the same level of environmental analysis that was prepared for the existing 1998-2010 Palo Alto Comp Plan. February 2016 Draft EIR The February 2016 Draft EIR prepared for the Comprehensive Plan Update examined four planning alternatives or “scenarios” at an equivalent level of detail to allow the public and the Council to assess a variety of land use and infrastructure options. The scenarios collectively present a range of possible outcomes to inform a final decision about the future of Palo Alto. In all likelihood, the final Comprehensive Plan Update will not be identical to any one of the EIR scenarios, but will be a hybrid. The four scenarios analyzed in the February 2016 Draft EIR are:  Scenario 1 is the “business as usual” scenario and shows the results if the City continued to operate under the existing 1998-2010 Comp Plan with no changes to goals, policies, and programs. Any new housing built would be constructed under existing zoning and no innovations in housing or new approaches to address the high cost of housing would be explored. No new growth management measures are anticipated, and any transit or traffic improvements would come from the existing infrastructure plan for the City.  Scenario 2 would slow the pace of job growth when compared with Scenario 1 by moderating the pace of office/research and development (R&D) development throughout the city. Scenario 2 would also ensure that the modest amount of housing growth expected under Scenario 1 would be built out as small units and other housing types appropriate for seniors and the Palo Alto workforce. Transportation investments in this scenario would include implementation of the County’s expressway plan.  Scenario 3 would implement a growth management regime similar to the interim annual limit on office/R&D adopted by the City Council in 2015 for the fastest changing areas of the city and would eliminate housing sites along San Antonio and South El City of Palo Alto Planning & Community Environment Department Page 4 Camino. In place of these housing sites, Scenario 3 would increase housing densities on sites Downtown, near California Avenue, and in other locations in the city close to transit and services. Policies, regulations, and incentives would be designed to ensure smaller units for working professional and senior populations. Transportation investments would include grade separating the Caltrain crossings at Meadow and Charleston by placing the railroad tracks in a trench.  Scenario 4 assumes the most growth in housing and employment evaluated in the February 2016 Draft EIR, consistent with 2013 Association of Bay Area Governments (ABAG) projections. Potential policies and regulations would be enacted to advance sustainability objectives. Transportation investments would include grade separating the Caltrain crossings at Meadow and Charleston by placing the railroad tracks in a trench, and incorporating mix flow bus rapid transit on El Camino Real (with curbside stations and queue jumping for transit vehicles). Housing sites along San Antonio and South El Camino Real would be eliminated and replaced with higher densities elsewhere as well as new housing sites along the El Camino frontage of the Stanford Research Park and the Stanford Shopping Center. The Supplement to the Draft EIR: Scenarios 5 & 6 During two City Council meetings in early 2016 (January 19 and February 22), City Council members indicated their desire to analyze an additional scenario in a supplement to the Draft EIR, and on May 16, 2016 the City Council provided basic parameters of two new scenarios (Scenarios 5 and 6).  Scenario 5 involves 10 percent fewer jobs than Scenario 2 (previously the lowest job scenario), and the same number of housing units as Scenario 3. This scenario is intended to test the efficacy of mitigation and sustainability measures when applied to relatively slow growth over the 15 year planning period. Scenario 5 would test strategies designed to slow the pace of job growth and would replace or supplement the current citywide “cap” on new non-residential square footage in “monitored areas” with a permanent citywide annual limit on office and R&D development. This scenario would also discourage new multi-family housing along San Antonio Avenue and portions of south El Camino Real and San Antonio Avenue, removing housing sites in these areas, and would instead adopt policies and zoning regulations to increase residential densities Downtown, in the California Avenue area, and in other transit-rich areas. This scenario assumes that Caltrain would be grade separated at all crossings.  Scenario 6 would also involve 10 percent fewer jobs than Scenario 2, and roughly 36 percent more housing than Scenario 4. This new scenario is intended to test policies and programs to accelerate the production of housing over the 15 year planning period, while using a performance-based approach to address the impacts of growth. As under Scenario 4, this scenario would include mechanisms to stimulate additional multi-family housing on sites Downtown, the Fry’s Electronics vicinity, and on portions of the City of Palo Alto Planning & Community Environment Department Page 5 Stanford Research Park and Shopping Center fronting on El Camino Real. It would also include consideration of housing sites elsewhere in the Stanford Research Park and in the Stanford University Medical Center (SUMC) vicinity. Like Scenario 5, Scenario 6 assumes that Caltrain would be grade separated at all crossings. The Supplement to the Draft EIR: Contents The Supplement to the Draft EIR is organized into the chapters identified in Table 1 below. Table 1. Organization of the February 2017 Supplement to the Draft EIR Section Purpose/Contents Additional Notes Chapter 1: Executive Summary Summarizes the scenarios analyzed in the February 2016 Draft EIR and Supplement to the Draft EIR Table 1-3 presents the environmental impacts and mitigation for all six scenarios and identifies the level of significance of impacts before and after mitigation. Chapter 2: Introduction Provides an overview of the Supplement to the Draft EIR document Chapter 3: Project Description Describes Scenarios 5 and 6 Chapter 4: Environmental Evaluation Analyses impacts in 14 sub-chapters corresponding to the environmental resource categories in Appendix G of the CEQA Guidelines The Air Quality, Green House Gas (GHG), Noise, and Transportation sections include an expanded discussion of the effectiveness of proposed mitigation measures. Chapter 5: Significant Unavoidable Adverse Impacts Lists the significant and unavoidable impacts of the proposed Plan, as identified in Chapter 4. Chapter 6: Alternatives to the Proposed Project Discusses the “no project” alternative as required by CEQA and its relationship to the “business as usual” alternative represented by Scenario 1. This chapter also explains how the six scenarios represent a reasonable range of options, and describes a potential hybrid. Chapter 7: CEQA- Mandated Sections Discusses growth inducement, cumulative impacts, unavoidable significant effects, and significant irreversible changes as a result of the proposed Plan. This chapter also identifies environmental issues “scoped out” pursuant to CEQA Guidelines Section 15128. Chapter 8: Organizations and Persons Consulted Lists the people and organizations that were contacted during the preparation of the Supplement to the Draft EIR. NOTES: (1) Where changes to the February 2016 Draft EIR have been made, they are shown in strikethrough and underline. (2) Technical appendices are provided to support the analyses in Chapter 4. Source: Palo Alto Planning & Community Environment, February 2017 The Supplement to the Draft EIR: Revisions to the February 2016 Draft EIR As noted above, Chapter 4 contains strikethrough and underline formatting that indicates revisions to the environmental setting and mitigation measures of the February 2016 Draft EIR. City of Palo Alto Planning & Community Environment Department Page 6 Tables and figures that appeared in the February 2016 Draft EIR have the same number as in the February 2016 Draft EIR. Where new tables and figures have been added in the Supplement to the Draft EIR, they have sequential lettering. Revisions to the February 2016 Draft EIR were generally made for the following reasons:  Revisions to the environmental setting (i.e. existing conditions and regulatory framework) information were made to reflect public comments received on the February 2016 Draft EIR. Other revisions to the environmental setting were made to incorporate key changes to the environmental setting since the February 2016 Draft EIR was published. For example, the Hydrology and Water Quality chapter includes updates regarding the City’s groundwater dewatering policies, and the Greenhouse Gas Emissions and Climate Change chapter includes new text describing the Draft 2017 Climate Change Scoping Plan Update, which the California Air Resources Board released on January 20, 2017. Although these changes are not required under CEQA, since the “baseline” for the EIR is the Notice of Preparation publication date of May 30, 2014, the City included such updates to provide a thorough depiction of the current regulatory framework pertaining to key issues of community concern.  Revisions to impacts and mitigation measures were made to reflect public comments received on the February 2016 Draft EIR and to reflect the status of the Comp Plan Update. Many of the mitigation measures that previously prescribed specific policy wording have now been re-written so that they identify the most important policy topics that must be addressed by the Comp Plan Update in order to lessen or avoid potential environmental impacts. The intention of these revisions to the mitigation measures is to preserve their effectiveness while allowing the City the flexibility to refine the wording of policies in the Comp Plan Update that address environmental impacts.  In two places (Impacts GHG-2 and GHG-3) impacts that were previously identified as significant and unavoidable are now considered less than significant. Impact GHG-2 is now less than significant without mitigation, and Impact GHG-3 is a significant impact that can be mitigated to a less-than-significant level. Regarding Impact GHG-2, the February 2016 Draft EIR identified a 2050 GHG estimated efficiency target even though the horizon year for the Plan is 2030 and there is no legislative mandate for a GHG reduction plan to achieve the 2050 goal. The analysis for Impact GHG-2 has been revised in the Supplement to the Draft EIR to analyze consistency with the plans that have been adopted and legislative targets in place at the horizon year of the Comp Plan, and to reflect that the City has approved the draft Sustainability and Climate Action Plan (S/CAP) framework since the February 2016 Draft EIR. City of Palo Alto Planning & Community Environment Department Page 7 Regarding Impact GHG-3, the analysis has been revised to acknowledge that, through Mitigation Measure GHG-3, the City’s response to the impacts of climate change for new development would provide a strong framework for climate change resiliency and would reduce impacts to the extent feasible.  The February 2016 Draft EIR found that Impact referred to as “POP-4” would be less than significant and would therefore not require mitigation. However, the February 2016 Draft EIR included mitigation measures to acknowledge the City’s efforts to address the existing imbalance of employed residents to jobs. Under CEQA, mitigation measures are not appropriate for less than significant impacts. Also, the introduction of Scenarios 5 and 6 provide an alternate way to address this issue. As a result, Mitigation Measures POP-4a and POP-4b have been removed in the Supplement to the Draft EIR. Revised Fiscal Study Economic & Planning Systems, Inc. (EPS) documented the existing fiscal and economic conditions and analyzed the potential fiscal impacts attributable to the alternative land use scenarios considered in the Comprehensive Plan Update process. Their initial analysis was presented to the City’s Finance Committee on March 15, 2016 and has now been revised to reflect the Committee’s comments and the addition of Scenario 5 and Scenario 6. As previously, the Revised Fiscal Impact Analysis Report (link provided above) details the methodology employed for the analysis, study caveats, analytical approach and key assumptions, and key findings and conclusions, not all of which are repeated here. In summary, the fiscal analysis assesses the effect of future residential and non-residential (employment supporting) development on the City of Palo Alto General Fund from 2015 through 2030. The analysis focuses specifically on the effect that population and employment growth will have on the City’s $171.1 million 2015 Adopted General Fund Operating Expenditure Budget.1 The Fiscal Impact Model developed for this effort assesses revenue and cost effects attributable to growth on a revenue-line-item and department-by- department cost basis. The model holds current operations factors constant, including tax rates, organizational structures, and governance policies. While these and other factors will change over time, this analytical approach seeks to isolate the fiscal impact attributable to residents, workers, and visitors, as well as fiscal impacts attributable to specific land use categories. The analysis presents year 2030 results in constant 2015 dollars. The fiscal analysis forecasts the net impact (i.e., revenues less costs) for each of the Comprehensive Plan scenarios. The attribution of revenues and costs to specific types of growth provides useful information on alternative paths of growth for the City. The study finds that the growth envisioned in all six Comprehensive Plan scenarios likely will generate net revenue for the City of Palo Alto General Fund. These fiscal effects reflect annual per- capita fiscal net benefits of about $240 to $320 per net new person (including new residents and workers), with each new resident generating about $340 to $360 and each new employee generating about $190 to $280. City of Palo Alto Planning & Community Environment Department Page 8 Accordingly, this analysis finds that the most significant growth scenarios (Scenario 4 and Scenario 6) will generate the greatest financial gain for the General Fund. It is important to recognize that despite being positive, the net fiscal impacts calculated by this analysis are quite modest relative to the total City General Fund budget. The greatest net fiscal impact identified, $7.4 million under Scenario 4, represents about four percent of the Fiscal Year 2015 General Fund expenditure budget. Also, the analysis finds that the expected fiscal benefit of a new resident in Palo Alto is greater than the expected fiscal benefit of a new employee in the City even though the new resident generates a higher marginal cost burden compared to local workers. Discussion The Comp Plan Update EIR differs from most EIRs in that it assesses multiple scenarios at an equal level of detail. The scenarios are intended to illustrate potential impacts of policy decisions that will have to be made as the Comprehensive Plan Update planning process is completed. By using this approach, the EIR is intended to advance and inform the planning process, and not to dictate what its outcome will be. As anticipated, the City Council’s direction on January 30, 2017 suggests that their “preferred scenario” is not identical to any of those analyzed in the EIR, but is a hybrid of several. The City Council continued this discussion on March 20, 2017 and indicated their support for a preferred scenario that will fall within the middle of the range when it comes to the housing, jobs, and nonresidential square footage expected during the life of the Comp Plan. Specifically, the Council supported projections of:  3,545 to 4,420 new dwelling units over the life of the plan (i.e. somewhere between Scenarios 4 and 5)  9,850 to 11,500 new jobs over the life of the plan (i.e. somewhere between Scenarios 2 and a modified Scenario 3)  Up to 3 Million Square Feet of new non-residential development over the life of the plan, 1.3 Million of which has already been approved at SUMC (i.e. similar to Scenario 2) The PTC is welcome to provide comments on the Supplement to the Draft EIR and the Draft EIR, and may wish to comment as well on the “preferred scenario.” Comments and questions posed at this evening’s hearing will not be responded to tonight, but will be addressed in the Final EIR to the extent they raise substantive issues about environmental impacts, mitigation measures, or alternatives. PTC Process for Review: Options for Discussion As noted in Attachment C, the Palo Alto Municipal Code gives the PTC a primary role in crafting, adopting, and monitoring implementation of the Comprehensive Plan. The PTC began this process with close to six years of work on a first draft of the elements, which was provided to the Council in early 2014. The City Council is now completing its initial City of Palo Alto Planning & Community Environment Department Page 9 review, with input from the CAC, and is scheduled to refer the revised draft back to the PTC for additional review this summer. The PTC will be asked to hold multiple public hearings, and formulate a recommendation to the City Council. To discharge this responsibility, individual Commissioners and staff have suggested various possible approaches:  Form a subcommittee of the PTC to conduct the review and bring forward recommendations on each element for consideration by the full Commission over the course of the summer  Assign each Commissioner to take the lead on one element and bring forward recommendations on each element for consideration by the full Commission over the course of the summer  Simply schedule a series of public hearing/work sessions over the summer for the full Commission to conduct a high-level review and craft a recommendation to the Council In all of these options (and in any others not on this list), we must be cognizant of all the time the PTC (albeit with different members) has already spent on this effort, as well as the City Council’s goal to complete the Comp Plan update by the end of the year. It’s clear that we are long past the “word-smithing” part of the planning process, and the PTC’s most valuable contribution at this point would be a high-level review to ensure the final work product accurately reflects the community’s values and articulates an acceptable vision and policy structure to inform good decision making over the life of the plan. Staff plans to facilitate this effort by summarizing prior Council direction, community/CAC input, and key questions for the PTC’s consideration as they review each element. Also, while the Commission is crafting their recommendations, staff and consultants will be focused on preparing the Final EIR with the intent of providing the PTC with a copy before they conclude their work so the PTC can also provide a recommendation to the Council on certification of the EIR. This means there will be limited consultant and staff time available to support PTC subcommittees or to prepare revisions and re-revisions of the various plan sections. For this reason, staff would appreciate it if the PTC’s recommendations could take the form of a list of recommended revisions or a report that can be attached to a resolution adopting the plan, rather than a tracked-changes document. Once the City Council has received the PTC’s recommendations, the Council will consider to certifying the Final EIR and adopting the Comp Plan Update, subject to re-review and a report by the PTC, as provided for in PAMC Section 19.04.080. Policy Implications The Comprehensive Plan is the City’s “constitution” when it comes to land use and development issues, including transportation and the protection of the environment. Comprehensive Plan Update is expected to perpeuate the overall vision and values of the current plan, while updating some of its goals, policies, and implementation programs. City of Palo Alto Planning & Community Environment Department Page 10 Resource Impact The Comprehensive Plan Update has been a time consuming and costly project for the City. Current contracts are sufficient to complete the project provided in accordance with the current schedule, which envisions completion of the CAC process in May and adoption of an updated plan by the end of the year. Timeline/Next Steps The Supplement to the Draft EIR is available online on the project website at: (http://www.paloaltocompplan.org/eir/). Members of the public are invited to provide oral comments at this evening’s meeting. Written comments are also being accepted until the close of business on March 31, 2017. All substantive comments received during the comment period will be responded to in a Final EIR. The Final EIR must be completed and certified before the City Council can consider approval of the Comprehensive Plan Update, which is targeted for late 2017. Staff expects that the City Council will refer the Draft Comp Plan Update to the PTC for review this summer (probably in late June), and request the PTC’s recommendation by the end of August or September. Environmental Review A program level EIR is being prepared for the Comprehensive Plan Update, as summarized in this staff report. Public comments are currently being accepted on the February 2016 Draft EIR and the February 10, 2017 Supplement to the Draft EIR. Report Author & Contact Information PTC1 Liaison & Contact Information Hillary Gitelman, Director Jonathan Lait, AICP, Assistant Director (650) 329-2321 (650) 329-2679 hillary.gitelman@cityofpaloalto.org jonathan.lait@cityofpaloalto.org Attachments:  Attachment A: Supplemental DEIR NOA (PDF)  Attachment B: Matrix of EIR Scenarios February 2017 (PDF)  Attachment C: PAMC Chapter 19.04 (PDF) 1 Emails may be sent directly to the PTC using the following address: planning.commission@cityofpaloalto.org NOTICE OF AVAILABILITY AND COMPLETION (NOTICE OF INTENT) OF A SUPPLEMENT TO THE DRAFT ENVIRONMENTAL IMPACT REPORT FOR THE COMPREHENSIVE PLAN UPDATE (SCH#2014052101) NOTICE IS HEREBY GIVEN that a Supplement to the Draft Environmental Impact Report (EIR) has been prepared to assess the environmental impacts of the following project: COMPREHENSIVE PLAN UPDATE LEAD AGENCY: City of Palo Alto, 250 Hamilton Avenue, Palo Alto, CA 94301 Project Description: The Palo Alto Comprehensive Plan is the City's governing document for land use and development decisions. The City is undertaking a Comprehensive Plan Update in order to establish a shared vision for the future of the community through to the year 2030. The Project will update Plan goals, policies, programs, narrative, maps and diagrams. Given the long-term horizon of the proposed Plan and the permitting, planning and development actions that are related both geographically and as logical parts in the chain of contemplated actions for implementation, a draft EIR has been prepared as a program EIR, pursuant to the CEQA Guidelines. A Draft Program EIR was published on February 5, 2016 for a 90-day comment period that was subsequently extended to 124 days (ending June 8, 2016). The Program EIR analyzed four planning scenarios at an equal level of detail within the body of the Draft EIR, thereby illuminating potential environmental impacts of a range of alternatives designed to address the proposed Plan objectives. Scenario 1 is a “Business as Usual” scenario and assumes the proposed Plan would not be adopted, and change and development in Palo Alto through 2030 would occur under the existing Comp Plan. Scenarios 2, 3, and 4 each include different strategies related to the pace of non-residential development and job growth, the placement of housing sites and densities, desired transportation investments, and sustainability measures. In early 2016, the City Council directed City staff to analyze two additional scenarios to broaden the range of potential outcomes and provide additional information to inform the planning process. This Supplement to the Draft EIR has been prepared to assess the two additional scenarios, called Scenarios 5 and 6. Scenario 5 would lower job growth below current projections and allow a modest increase in housing in an effort to improve the City’s jobs-to-employed-residents ratio. Scenario 6 would also lower job growth below current projection and allow robust increase in housing in an effort to address issues of housing affordability and supply in the City and improve the City’s jobs-to-employed-residents ratio. Probable Environmental Effects of the Project: The EIR will evaluate potentially significant environmental impacts associated with the adoption and implementation of the Comprehensive Plan Update, consistent with the State California Environmental Quality Act (CEQA). The proposed project will have potentially significant environmental effects with regard to Aesthetics, Air Quality, Greenhouse Gas Emissions and Climate Change, Land Use, Public Services and Recreation, Transportation and Traffic, Noise, Utilities and Service Systems, Cultural Resources, and Hydrology and Water Quality. CEQA requires this notice to disclose whether any listed toxic sites are present at the project location. This is a citywide project, and there are sites within the city that are contained in the Cortese List of toxic sites. The Draft EIR is on file and may be reviewed at the Palo Alto Planning Division, 250 Hamilton Avenue, 5th floor, during business hours. The EIR will also be available for review on the City’s project website-- http://www.paloaltocompplan.org, and at the following public libraries: Rinconada Library, 1213 Newell Rd., Palo Alto, CA 94303, and Palo Alto Downtown Library, 270 Forest Ave., Palo Alto, CA 94301. The public review for this Supplement to the Draft EIR begins on February 10, 2017 and ends on March 31, 2017. If you wish to provide written comments on the Supplement or the Draft EIR, please submit these to Elena Lee, Department of Planning and Community Environment, 250 Hamilton Avenue, Palo Alto, CA 94301, or Elena.Lee@CityofPaloAlto.org, no later than March 31, 2017, at 5:00 p.m. During the public review period, both the Planning & Transportation Commission and the City Council will hold public meetings to take public testimony on the Draft EIR. The public meetings are tentatively scheduled for March 20, 2017 at 7:00 p.m. (City Council) and March 29, 2017 at 6:00 p.m. (Planning & Transportation Commission). Both meetings will occur in the Council Chambers, 1st Floor City Hall, 250 Hamilton Avenue and all persons may appear and be heard at these meetings. Substantive public comments received at these meetings and in writing will be responded to in a Final EIR before there is any decision to adopt The Comprehensive Plan Update. Members of the public are also encouraged to attend meetings of the Citizens Advisory Committee to offer their comments and suggestions regarding the development of policy language for the updated plan. Visit PaloAltoCompPlan.org for more information. If any person challenges this item in court, that person may be limited to raising only those issues the person or someone else raised at the public hearings described in this notice, or in written correspondence delivered at, or prior to, the public hearings. In compliance with the Americans with Disabilities Act, those requiring accommodation for these meetings should notify the City of Palo Alto 24 hours prior to the meetings at (650) 329-2496. HILLARY GITELMAN, DIRECTOR OF PLANNING AND COMMUNITY ENVIRONMENT West Homestead Road AlmaStreet JuniperoSerraBoulevard E m ba rcader o R oad StevensCreekBoulevard Ar astra d ero Road Arastradero R oad Rainbow Drive Fremont Avenue South Stelling Road SanAntonioRoad South de Anza Boulevard QuarryRoad Bubb Road Belleville Way El Ca mino Real Oregon Expressway FoothillExpressway £¤101 SAN FRANCISCO BAY |ÿ82 Stanford Menlo Park East Palo Alto Mountain View Los Altos Los Altos Hills %&'(280 %&'(280 Ü Ü Baylands Preserve Ü Atascadero Preserve Foothills Park Los Trancos Open Space Preserve Monte Bello Open Space Preserve Ü Ü Ü Ü Stanford Station Palo Alto Station UniversityAvenue California Avenue Station Middlefield Road CITY OF PALO ALTO COMPREHENSIVE PLAN AMENDMENT EIR FIGURE 1 PROJECT LOCATION AND CONTEXT Source: The Planning Center | DC&E, 2013; The City of Palo Alto, 2013. 012Miles PROJECT LOCATION SAN FRANCISCO BAY %&'(280 |ÿ92 |ÿ84 %&'(280 £¤101 Oakland San Jose San Francisco Los Altos Menlo Park Mountain View Cal Train Stations City Boundary Sphere of Influence Creeks Public Conservation Land California Avenue Concept Plan Area East Meadow Circle Concept Plan Area %&'(880 %&'(580 %&'(680 SanFrancisquitoCreek Adobe Cr e ek AtascaderoCreek Matad e ro Cr e e k BarronCreek Comprehensive Plan Update 2014‐2030 Draft EIR Scenarios:  Key Characteristics & Impacts * (1 of 2) Key Characteristics/Impacts 2014 Existing Conditions [01]Scenario 1 Scenario 2Scenario 3 Scenario 4 Scenario 5 [02]Scenario 6 February 2016  DEIR Page  (Scenarios 1‐4) February 2017  Supplement to the  Draft EIR  (Scenarios 5‐6)**  “Business as Usual” “Slowing Growth” "Housing Tested I""Sustainability  Tested I" "Sustainability  Tested II" "Housing Tested  II"Page Reference Page Reference** City Population 65,685 72,285 72,285 74,120 76,140 74,120 79,765 3‐24,33,38 & 44 3‐19, 3‐23 City & Sphere of Influence (SOI) Population 80,805 90,210 90,210 92,045 94,065 92,045 97,690 3‐24,33,38 & 44 3‐19, 3‐23 City Housing Units [03]28,545 31,265 31,265 32,090 32,965 32,090 34,545 3‐24,33,38 & 44 3‐19, 3‐23 City & SOI Housing Units [04]33,070 36,950 36,950 37,780 38,650 37,780 40,235 3‐24,33,38 & 44 3‐19, 3‐23 City Jobs [05]95,460 110,940 105,310 108,215 110,940 104,325 104,325 3‐24,33,38 & 44 3‐19, 3‐23 City & SOI Jobs 100,830 116,700 111,070 113,975 116,700 110,085 110,085 3‐24,33,38 & 44 3‐19, 3‐23 City Employed Residents [06]31,165 34,697 34,697 35,578 36,547 35,578 38,287 4‐11.29 4.11‐16 City & SOI Employed Residents [07]36,004 40,595 40,595 41,420 42,329 44,182 46,891 4‐11.29 4.11‐16 City Jobs/Employed Residents Ratio 3.06 3.20 3.04 3.03 3.04 2.93 2.72 4‐11.29 4.11‐16 City & SOI Jobs/Employed Residents Ratio 2.80 2.87 2.74 2.75 2.76 2.49 2.35 4‐11.29 4.11‐16 Key Characteristics/Impacts (NET CHANGE)Scenario 1 ∆  (NET CHANGE) Scenario 2∆  (NET CHANGE) Scenario 3 ∆  (NET CHANGE) Scenario 4 ∆  (NET CHANGE) Scenario 5∆ (NET CHANGE) Scenario 6∆ (NET CHANGE) February 2016  DEIR Page  (Scenarios 1‐4) February 2017  Supplement to the  Draft EIR  (Scenarios 5‐6)** City Population 6,600 6,600 8,435 10,455 8,435 14,080 3‐19 3‐19, 3‐23 City & SOI Population 9,405 9,405 11,240 13,260 11,240 16,885 3‐19 3‐19, 3‐23 City Housing Units [03]2,720 2,720 3,545 4,420 3,545 6,000 3‐19 3‐19, 3‐23 City & SOI Housing Units [04]3,880 3,880 4,710 5,580 4,710 7,165 3‐19 3‐19, 3‐23 City Jobs [05]15,480 9,850 12,755 15,480 8,865 8,865 3‐19 3‐19, 3‐23 City & SOI Jobs 15,870 10,240 13,145 15,870 9,255 9,255 3‐19 3‐19, 3‐23 Estimated Net New Non‐Residential Square  Footage in Policy L‐8 "Monitored Areas"   2014‐2030 (millions sq ft)  [08] ~1.7 ~1.7 ~1.9 ~2.4 ~1.1 ~1.1 Estimated Net New Non‐Residential Square  Footage Entire City 2014‐2030 (millions sq ft) [09] ~3.3 ~3.0 ~3.5 ~4.0 ~2.4 ~2.4 3‐19 3‐11 Transportation Impacts 2014 Existing Conditions Scenario 1 Scenario 2Scenario 3 Scenario 4 Scenario 5Scenario 6 February 2016  DEIR Page  (Scenarios 1‐4) February 2017  Supplement to the  Draft EIR  (Scenarios 5‐6)** City Total Motor Vehicle Trips 432,122 479,198 467,567 475,362 463,255 444,204 457,633 4.13‐47 4.13‐23 City & SOI Total Motor Vehicle Trips 499,013 549,691 538,480 545,826 533,336 514,665 527,293 4.13‐45 4.13‐19 City Total Average Trip Length (miles) 12.31 12.41 12.28 12.31 12.50 12.41 12.37 4.13‐47 4.13‐23 City & SOI Total Average Trip Length (miles) 12.81 12.94 12.81 12.83 13.00 12.92 12.88 4.13‐45 4.13‐19 City Total Vehicle Miles Travelled (VMT) 5,320,931 5,947,158 5,741,373 5,853,201 5,788,497 5,511,446 5,663,040 4.13‐49 4.13‐23 City & SOI Total Vehicle Miles Travelled  (VMT)6,391,293 7,110,437 6,897,508 7,000,886 6,932,573 6,651,773 6,792,095 4.13‐49 4.13‐19 City VMT Per Capita 33.0 32.5 32.3 32.1 30.9 30.9 30.8 4.13‐49 4.13‐25 City & SOI VMT Per Capita 34.8 35.2 34.0 34.4 33.9 34.3 33.6 34.0 32.9 32.9 32.7 Updated in  Supplement 4.13‐22 City Mode Share for Palo Alto Daily Person  Trips (%) ‐ Drive Alone 61.5% 59.9% 60.0% 59.7% 58.5% 58.9% 58.5%4.13‐50 4.13‐26 City Mode Share for Palo Alto Daily Person  Trips (%) ‐ Shared Ride 22.7% 22.2% 22.3% 22.2% 21.9% 21.9% 22.0%4.13‐50 4.13‐26 City Mode Share for Palo Alto Daily Person  Trips (%) ‐ Transit 5.1% 6.8% 6.6% 6.8% 7.8% 7.6% 7.8%4.13‐50 4.13‐26 City Mode Share for Palo Alto Daily Person  Trips (%) ‐ Bike 2.8% 3.1% 3.1% 3.1% 3.2% 3.2% 3.2%4.13‐50 4.13‐26 City Mode Share for Palo Alto Daily Person  Trips (%) ‐ Walk 7.9% 8.1% 8.1% 8.2% 8.6% 8.4% 8.6%4.13‐50 4.13‐26 2013 Scenario 1 Scenario 2Scenario 3 Scenario 4 Scenario 5Scenario 6 February 2016  DEIR Page  (Scenarios 1‐4) February 2017  Supplement to the  Draft EIR  (Scenarios 5‐6)** Daily Transit Boardings To, From and Within  Palo Alto (Including, BART, Caltrain, VTA,  Shuttles, etc.) 44,053 62,177 57,287 61,013 70,045 64,375 66,315 4.13‐69 4.13‐47 Comprehensive Plan Update 2014‐2030 Draft EIR Scenarios:  Key Characteristics & Impacts * (2 of 2) Palo Alto Unified School District (PAUSD)  Impacts  [10] Existing Conditions  Enrollments  2013‐2014/2014‐2015  (Capacity) Scenario 1 Scenario 2Scenario 3 Scenario 4 Scenario 5Scenario 6 February 2016  DEIR Page  (Scenarios 1‐4) February 2017  Supplement to the  Draft EIR  (Scenarios 5‐6)**  “Business as Usual” “Slowing Growth” "Housing Tested" Sustainability Tested "Sustainability Tested  II""Housing Tested II" Page Reference Page Reference** Net Elementary School Students Enrollment  Increase 5,784 / 5,677 (6,227)388 893 388 893 471 1,083 558 1,283 1,083 1,648 Existing: 4.12‐4;  Scenarios:  Updated in  Supplement 4.12‐4 to 4.12‐7 Net Middle School Students Enrollment  Increase 2,720 / 2,932 (2,950)155 466 155 466 188 565 223 670 565 860 Existing: 4.12‐4;  Scenarios:  Updated in  Supplement 4.12‐4 to 4.12‐7 Net High School Students Enrollment  Increase 3,848 / 3,840 (4,600)155 582 155 582 188 707 188 837 707 1,075 Existing: 4.12‐4;  Scenarios:  Updated in  Supplement 4.12‐4 to 4.12‐7 Net Total School Students Enrollment  Increase 12,352 / 12,449 (13,777)698 1,941 698 1,941 847 2,355 1,004 2,790 2,355 3,583 Existing: 4.12‐4;  Scenarios:  Updated in  Supplement 4.12‐4 to 4.12‐7 Parkland Needed [11]2014 Existing Conditions Scenario 1 Scenario 2Scenario 3 Scenario 4 Scenario 5Scenario 6 February 2016  DEIR Page  (Scenarios 1‐4) February 2017  Supplement to the  Draft EIR  (Scenarios 5‐6)** Acres of Parkland Needed by Scenario (ac)   @  4 acres per 1,000 new residents 4,384.4 89.3 26.4 26.4 33.7 41.8 33.8 56.3 Updated in  Supplement 4.12‐20 Greenhouse Gas (GHG) Impacts 2014 Existing Conditions Scenario 1 Scenario 2Scenario 3 Scenario 4 Scenario 5Scenario 6 February 2016  DEIR Page  (Scenarios 1‐4) February 2017  Supplement to the  Draft EIR  (Scenarios 5‐6)** City GHG Emissions (MtCO2e/Year)519,517 520,184 419,914 420,046 416,058 424,733 419,533 428,669 421,842 431,749 404,111 421,952 Updated in  Supplement 4.6‐11, 4.6‐12 City & SOI GHG Emissions (MtCO2e/Year)600,207 601,783 494,458 494,636 485,707 485,133 489,074 488,841 491,095 491,737 463,299 481,379 Updated in  Supplement 4.6‐11, 4.6‐12 Utilities Impacts 2014 Existing Conditions  (Baseline)Scenario 1 Scenario 2Scenario 3 Scenario 4 Scenario 5Scenario 6 February 2016  DEIR Page  (Scenarios 1‐4) February 2017  Supplement to the  Draft EIR  (Scenarios 5‐6)** City & SOI Water Demand ‐ Gallons Per Day  (GPD)4,230,635,205 4,485,942,577 4,485,531,107 4,485,877,531 4,486,224,321 4,485,593,230 4,486,005,796 4.14‐23 4.14‐3 City & SOI Increase in Solid Waste Generation  over 2014 Baseline (tons/yr)51,265 13,240 10,851 13,382 15,953 11,607 15,315 4.14‐73 4.14‐27 City & SOI Total Electricty Increase over 2014  Baseline (kWh)1,017,067,516 152,818,068 106,148,597 134,778,309 162,135,150 102,532,440 115,987,402 4.14‐96 4.14‐35 City & SOI Natural Gas Increase over 2014  Baseline (therms)31,729,420 4,493,949 3,419,165 4,286,982 5,135,532 3,544,370 4,470,891 4.14‐23 4.14‐36 NOTES *  ALL IMPACTS REPORTED ARE PRIOR TO ANY MITIGATION 01) 2014 in most cases.   02)  City Council would like to develop a scenario that improves the City’s ratio between jobs/employed residents.  This new scenario can also include additional housing proposed in the SOI by Stanford University 03)  2014 Housing Units (HU) ‐2010 Decennial Censsus baseline plus HU's built between 2010 ‐2014 based on building permit activity 3a.  Scenario 1 2030 HU forecast based on  Palo Alto long term average units produced per year and known pipeline projects. 04)  2014 HU for Sphere of Influence (SOI) ‐2010 Decennial Censsus baseline plus Stanford General Use Permit (GUP) Annual Report to Santa Clara County on Housing built for years 2010 ‐2014  4a.  Scenario 1 2030 HU forecast for SOI assumes full buildout of Stanford GUP by 2030. 05)  2014 Existing  jobs derived from ABAG Projections 2013  Jobs forecast interpolated from years 2010‐2015.  2030 Jo bs forecast for Scenarios 1 & 4 derived from ABAG Projections 2013 .  06)  2014 Employed Residents for City derived from US Census , ACS 3‐year estimates 2011‐2013 6a.  To determine the number of employed residents in the scenarios, PlaceWorks assumed that 48 percent of the 2030 (city Limit) population would be employed which is  the same percentage of employed residents to total  population as is found in the ABAG 2030 Projections. 07)   2014  Employed Residents for City & SOI derived from ABAG Projections 2013 interpolation between 2015‐2010 7a.   To determine the number of employed residents in the scenarios, Placeworks assumed that 45 percent of the 2030 (City Limit + SOI) population would be employed which is the same percentage of employed residents   to total   population as is found in the ABAG 2030 Projections. 08)  Only Scenarios 3 & 4 assume surpassing the 3.2 million Policy L‐8 limit.  “Monitored Areas” are identified on Map L‐6 and referenced in Policy L‐8.  There are also land uses within "Monitored Areas" that are exempt from the 3.2 million Policy L‐8 limits.   09)  Estimated Net new non‐residential square feet forecast for entire City. 9a.  Scenario 1 ‐Includes 1.7 million sq ft in "monitored areas" remaining in 3.2 million limit in Policy L‐8, 1.3 million sq ft of approved SMC expansion plus ~300k sq ft of non‐res devt in other "non‐monitored" areas. 9b.  Scenario 2 ‐Includes 1.7 million sq ft in "monitored areas" remaining in 3.2 million limit in Policy L‐8 & 1.3 million sq ft of approved SMC expansion.   9c.  Scenario 3 ‐Includes 1.7 million sq ft in "monitored areas" remaining in 3.2 million limit in Policy L‐8, 1.3 million sq ft of approved SMC expansion , plus ~200k sq ft of non‐res devt above 3.2 m limit in Policy L‐8 and ~300k of additional non‐res devt in other "non‐monitored" areas. Less job density type of non‐res devt.   9d.  Scenario 4 ‐Includes 1.7 million sq ft in "monitored areas" remaining in 3.2 million limit in Policy L‐8, 1.3 million sq ft of approved SMC expansion, plus ~700k  sq ft of non‐res devt above 3.2 m limit in Policy L‐8 and ~300k of additional non‐res devt in other "non‐monitored" areas . Less job density type of non‐res devt.   10)  Generattion rates are consistent with "moderate" generation rates used in 2014 PAUSD Enrollment Projections prepared by Decision Insite.  PAUSD uses "moderate" generation rates that are typical of students enrollmed from existing developments of similar product type.  This analysis also assumes that all new housing would be multi‐ family housing. 11)  Neighborhood and District Parks only.  Calculated @ 4 acres per 1,000 new residents.   **  The Supplemental Draft Environmental Impart Report (SDEIR) is scheduled for publication on February 10, 2017.  Some figures or data points  for Scenarios 1‐4 on the original EIR published on February 2016 may have been updated.  The page numbers referenced on the SDEIR may have changed prior to final publication .   Planning & Transportation Commission Staff Report (ID # 7799) Report Type: Study Session Meeting Date: 3/29/2017 City of Palo Alto Planning & Community Environment 250 Hamilton Avenue Palo Alto, CA 94301 (650) 329-2442 Summary Title: Annual Office/R&D Limit: Regulatory Discussion Title: Discussion and Comments for City Council Consideration Regarding Development of an Ordinance to Perpetuate an Annual Limit on Office/R&D Development Following Expiration of Interim Ordinance #5357 Restricting Such Land Uses in Certain Parts of the City to 50,000 Square Feet per Year. Environmental Analysis: This Discussion is not a Project Pursuant to the California Environmental Quality Act (CEQA). For More Information, Please Contact Clare Campbell at clare.campbell@cityofpaloalto.org. From: Hillary Gitelman Recommendation Staff recommends that the Planning and Transportation Commission (PTC) discuss and provide comments for City Council consideration regarding development of an ordinance to adopt on a permanent basis the annual limit on office and R&D development of 50,000 square foot per year within defined areas of the City, currently in effect for an interim period. Executive Summary On September 21, 2015, the City Council adopted an ordinance (Attachment A) establishing on an interim basis an annual limit on the amount of net new office/R&D space that can be approved each fiscal year in specified areas of the City including Downtown, the California Avenue area, and the El Camino Real Corridor. As part of the implementation of the ordinance, administrative procedures (Attachment B) were adopted by Council in February 2016. The interim ordinance is due to expire on November 26, 2017. The objective of this discussion is to provide an update on the office development that has occurred since the implementation of the interim ordinance; and to get specific comments from the PTC to forward to the City Council regarding a permanent ordinance regulating the pace of office/R&D development. City of Palo Alto Planning & Community Environment Department Page 2 Background The City’s Comprehensive Plan contains an overall cap of 3.2 million square feet on the amount of non-residential development that can occur in Downtown and in the City as a whole, but does not currently limit the pace of development.1 The City Council discussed the idea of limiting the pace of new office/R&D development over the course of six meetings from January through June of 2015. (CMR: 5877; CMR: 5689; CMR: 5621; CMR: 5565; CMR: 5518; CMR: 5404.) This issue has also been discussed throughout the Comprehensive Plan Update process, including during discussions of the draft Land Use and Community Design Element. During the January 30, 2017, City Council hearing on the draft Land Use Element, Council approved a motion that directed staff to bring forward a permanent annual limit ordinance separate from the Comprehensive Plan Update. Interim Ordinance (2015) On March 23 and June 15, 2015, the City Council adopted a series of motions directing staff to prepare an interim ordinance to effectuate an annual limit on new office/R&D development in those areas of the City experiencing the most rapid change. Key characteristics of the resulting ordinance that was ultimately adopted on September 21, 2015, include but are not limited to:  Office/R&D annual limit would run until the adoption of the new Comprehensive Plan or for two years whichever is sooner;  The limit would apply to an area comprised of the Downtown, California Avenue area, and the El Camino Real corridor (see map included in Attachment A);  The limit would be set at 50,000 sq. ft. of new office/R&D development (net gain) per fiscal year. The ordinance established exemptions from the annual limit for certain projects, including pipeline projects (pending applications deemed complete prior to March 31, 2015) and “self- mitigating projects,” which are projects that provide rental housing for more members of the workforce than would be employed by the project and included a robust transportation demand management plan. The interim ordinance also included evaluation criteria for projects competing, with the most highly-rated projects receiving entitlements and the eligibility to move forward to construction. The annual limit of 50,000 net new square feet is intended to be a pacing mechanism when there are applications for more than this amount of new square footage pending approval in a given year. This ensures square footage comes on line at a moderated pace, despite fluctuations in economic cycles. Since 2001, there were six years where office/R&D development in the commercial districts affected by the interim ordinance exceeded 50,000 1 The cap that applies to the City as a whole was established by Comprehensive Plan Policy L-8 and addresses non- residential development in “monitored areas.” The non-residential development pursuant to this policy is not close to reaching the 3.2M square foot cap. City of Palo Alto Planning & Community Environment Department Page 3 square feet (FY2006, FY2007, FY2010, FY2012, FY2014 and FY2015). In each of the other years, the cumulative total of new square footage entitled in the affected areas was less than 50,000 square feet. Ordinance Summary The interim Annual Office Limit (AOL) ordinance establishes the covered land uses, areas affected, exemptions, and other procedural items. Below is a high-level summary of the key elements of the ordinance. Please refer to Attachment A for additional details. Affected Area The interim ordinance is applicable to three primarily commercial areas in Palo Alto: Downtown, California Avenue, and El Camino Real. These areas are clearly defined on the map (Exhibit A) included with the ordinance. Applicable Land Uses The following land uses, which are defined in Title 18 of the Palo Alto Municipal Code (PAMC), are limited by the Annual Office Limit:  Research and Development  Administrative Office Services  General Business Office  Medical Office over 5,000 sq. ft.  Professional Office Exempt Projects Aside from defined pipeline projects, there are three types of projects that would qualify for an exemption from the limitations:  Small projects less than 2,000 sq. ft. and accessory office space that is incidental to principal use.  Small medical office less than or equal to 5,000 sq. ft.  Self-mitigating projects that provide more rental housing to accommodate more workers than would be employed; and includes substantial transportation demand management strategies that improve current parking and traffic conditions. Selection Criteria When it is determined that the 50,000 sq. ft. limit will be exceeded by qualified projects, the following selection criteria are to be used by Council to evaluate projects:  Impacts: appropriate density of development; avoid/mitigate traffic and parking impacts.  Design: quality design and compatible with surroundings.  Environmental Quality: environmental impacts as determined in the California Environmental Quality Act (CEQA) analysis. City of Palo Alto Planning & Community Environment Department Page 4  Public Benefit: meaningful public benefits included.  Uses: mixed-use projects with substantial housing, retail, and cultural amenities. Administrative Guidelines The administrative guidelines (Attachment B) were reviewed and approved by Council on February 8, 2016 and outline the procedural steps in more detail to streamline implementation. Additionally, the scoring process and “scorecard” for evaluation of competing projects are explained in finer detail. When qualifying projects exceed the 50,000 sq. ft. limit, each project will be assigned points (based on criteria above) and then ranked; the Planning Director will provide Council with a recommended ranking for consideration. The guidelines also clarify that all Council approved entitlements would follow the standard review timelines (i.e. entitlement expiration, extensions, etc.) and if the applicant allowed the entitlement to expire, the approved square footage allocation associated with the project could not be rolled-over to another project; the approved project must use it or lose it. Discussion Outcome of AOL Ordinance Below is brief summary of the office development proposals in the areas impacted by the ordinance since implementation and feedback on the AOL selection process. Office/R&D Development The interim AOL ordinance has been in effect and applied to two review years. The first round of analysis for qualifying projects was last year in March 2016 and the 50,000 sq. ft. limit was not exceeded; Figure 1 below provides an overview of the steps in the process. Cumulatively, there were several projects anticipated to trigger the AOL review by Council, but at the March deadline, some projects could not move forward as proposed due to a variety of project related reasons, and the AOL review was not needed. Figure 1: Primary Decision Points in Process City of Palo Alto Planning & Community Environment Department Page 5 For this year, the last applicable year, it’s anticipated that the office square footage limit will not be reached by the projects on file by the March 31 deadline. Staff’s observation is that projects located in the affected areas are either limiting the office use to less than 2,000 sq. ft. (to be exempt) or choosing other commercial and housing uses instead of office to completely avoid the potential of additional rigors required by the interim AOL ordinance. Since the implementation of the AOL ordinance, there has not been any significant office development proposed in the ordinance-affected areas. Although the time period has been relatively short, it would appear that the ordinance has reduced that amount of applications for net new office projects. Effectiveness of Process Since the 50,000 sq. ft. annual office limit was not met, staff has not had the opportunity to experience or evaluate the efficacy of the selection process and review criteria outlined in the ordinance/administrative guidelines. If a permanent ordinance were to use a first-come-first- served process, rather than a competitive process, the process would be more objective and straight forward to implement. Requested Feedback from the PTC At the time of the adoption of the interim ordinance in 2015 and in their recent January 2017 discussion, it was clear that City Council intended to establish permanent code changes maintaining the development restrictions of the interim ordinance, possibly with some changes. On January 30, 2017, individual Councilmembers commented on this subject during their discussion of related Comprehensive Plan policies and indicated their support for expanding the affected area of the City (to the whole city minus the Stanford Research Park) and potentially dispensing with the competitive process (and transitioning to a first-come-first- served system). Staff will be returning to Council in the near future for more specific direction, and is seeking input from the PTC on all aspects of a permanent ordinance, including, but not limited to:  Affected areas within City;  Applicable land uses;  Appropriate floor area limitation;  Selection process for qualifying projects; and  Administrative guidelines. Comments from the PTC will be forwarded to Council for consideration. Staff anticipates preparing a draft ordinance based on Council direction, which would return to the PTC for review and recommendation later this year. Environmental Review City of Palo Alto Planning & Community Environment Department Page 6 The requested action to discuss and provide comments is not considered a project for the purposes of the California Environmental Quality Act (CEQA). Public Notification, Outreach & Comments A notice of a public meeting for this discussion item was published in the Palo Alto Weekly on March 17, 2017. In order to inform the community about the efforts to prepare the permanent Annual Office Limit ordinance, staff informed various known developers, property owners, architects, and resident groups about this meeting. At a minimum, staff will use electronic notification for interested parties and will maintain a project information page on the City’s website to keep the public up-to-date on meeting dates and staff reports. At the time of this report preparation, no public comments were received. Next Steps The Annual Office Limit interim ordinance (#5357), adopted on September 21, 2015, will expire on November 26, 2017. To have a permanent ordinance in place before the expiration date, Council action (first reading) must be completed no later than October 9, 2017. Prior to that action, the draft permanent ordinance will be brought to the PTC for review and recommendation to the City Council. Public outreach will be conducted throughout the process to ensure community involvement. Report Author & Contact Information PTC2 Liaison & Contact Information Clare Campbell, Senior Planner Jonathan Lait, AICP, Assistant Director (650) 617-3191 (650) 329-2679 clare.campbell@cityofpaloalto.org jonathan.lait@cityofpaloalto.org Attachments:  Attachment A: Interim Annual Office Limit Ordinance #5357 (PDF)  Attachment B: Interim Office Annual Limit Administrative Regulations (PDF) 2 Emails may be sent directly to the PTC using the following address: planning.commission@cityofpaloalto.org DocuSign Envelope ID: 058EA42C-633E-4A 13-9788-084 711 CF4A49 Ordinance No. 5357 Interim Ordinance of the Council of the City of Palo Alto Adding Section 18.85.200 (Annual Office Limit) to Chapter 18.85 entitled "Interim Zoning Ordinances" Imposing an Office Annual Limit of 50,000 Net New Square Feet in Designated Areas of City FINDINGS A. The City of Palo Alto has long been considered the birth place of Silicon Valley. With its proximity to Stanford University, its international reputation, its deep ties to technology firms, its highly rated public school system and its ample public parks, open space and community centers, Palo Alto continues to serve as a hub for technology-based business. B. Palo Alto is considered one of Silicon Valley's most desirable office market~_,_ _________ _ According to one study Class A office rates have climbed 49 percent since the start of 2010. The same study reported Class B office space increasing by 114.4% since 2010. C. In particular, average commercial rental rates have gone up significantly from 2013 to 2015. In 2013 the average monthly rental rate citywide for office was $4.57 per square foot. That rate increased to $5.12 in 2015. D. As a result, the City has seen a steady increase of new Office and Research and Development (R&D) projects. According to data submitted by the City to support the Valley Transportation Authority's Congestion Management Plan (CMP), since 2001, the City has added 234,002 of net new square feet of office/R& D development in the California Avenue area; 315,586 in the downtown area, and 46,210 in the El Camino Real corridor. E. While this new development is consistent with the City's zoning ordinance and its Comprehensive Plan, the rate of change has been faster than anticipated, resulting in changes in the character of the City's commercial districts. The changes have also resulted in additional parking demand, traffic, and greenhouse gas emissions, and negatively impact the City's jobs/housing ratio. F. Based on the CMP data, there have been six years since 2001 in which more than 50,000 net new square feet of Office/R&D development have been entitled in these districts combined, and these six years include the last two (fiscal years 2014 and 2015). G. Record high monthly rental rates for office space and low vacancy rates suggest that the rapid pace of development is likely to continue, putting pressure on sites that are not currently developed to their maximum potential, and contributing to a feeling in the community that the character of the City's commercial districts are changing too fast. 151001 cs 0131471 1 Rev. October 1, 2015 DocuSign Envelope 10: 05BEA42C-633E-4A 13-9788-084 711 CF4A49 The Council of the City of Palo Alto does ORDAIN as follows: SECTION 1. A new Section 18.85.200 {Annual Office Limit) is added to Chapter 18.85 entitled "Interim Zoning Ordinances" to the Palo Alto Municipal Code to read as follows: "18.85.200 Annual Office Limit 18.85.201 Definitions. For the purposes of this Ordinance, the following terms shall have the definitions below: (a) Office Annual Limit Area shall include the area shown in Exhibit A, comprising the commercial districts of Downtown, the California Avenue Area, and the El Camino Real corridor. (b) Office Annual Limit Land Uses shall include any of the following uses in the Office Annual Limit Area: 1. Research and Development as defined in Section 18.04.030(123); 2. Administrative Office Services as defined in Section 18.040.030(6); 3. General Business Office as defined in Section 18.040.030(61); 4. Medical Office greater than 5,000 net new square feet as defined in Section 18.04.030(95 ); and 5. Professional Office as defined in Section 18.04.030(116). (c) Qualifying Application shall mean an application for a permit or other planning entitlement for an Office Annual Limit Land Use which (1) has been determined to be complete, (2) has completed the necessary analysis under the California Environmental Quality Act and (3) has been reviewed by all required commissions and/or Planning Director, as applicable. 18.85.202 Office Annual Limit. During the pendency of this Ordinance no more than 50,000 net new square feet of Office Annual Limit Land Uses per fiscal year shall be approved by the City in the Office Annual Limit Area. (a) For purposes of this Ordinance, the fiscal year shall be defined as July 1 to June 30. (b)The 50,000 square foot limit imposed by this section shall not apply to exempt projects as defined in 18.85.203 and such projects shall not be counted towards this limit. (c) This restriction shall be in addition to any other applicable growth restriction including but not limited to Comprehensive Plan Policy L-8 and Section 18.18.040 of the Zoning Code. In the event multiple policies apply to a project, the policy most restrictive of growth shall apply. 18.85.203 Exemptions. The following shall be exempt from this Ordinance: 151103 cs 0131471 2 Rev. October 1, 2015 DocuSign Envelope ID: 058EA42C-633E-4A 13-9788-084711 CF4A49 (a) Small Projects. Projects containing less than 2,000 net new square feet or less of Office Annual Limit Land Uses and accessory office space that is incidental to and customarily associated with a principal use or facility are exempt from the Office Annual Limit. (b) Small Medical Office Projects. Projects containing 5,000 net new square feet or less of Medical Office are exempt from the Development Cap. (c) Self-Mitigating Projects. Projects that would both: (1) provide rental housing for more workers than would be employed in the project; and (2) provide substantial transportation demand management strategies (individually or in cooperation with other projects or programs) to improve the current parking and traffic conditions. (d) Pipeline Projects. Projects which have been approved, or which are considered "pipeline projects" as follows: 1. Projects which obtained a planning entitlement for an Office Annual Limit Land Use prior to the effective date of this ordinance. 2. Projects which are the subject of a planning entitlement application that was submitted to the City in 2013 or 2014 and deemed complete by the City on or before March 31, 2015. (e) City Office Space. New office space used by the City of Palo Alto. 18.85 .205 Economic Hardship Waiver or Adjustment. An applicant may request that the requirements of this Ordinance be adjusted or waived based on a showing that applying the requirements of this Ordinance would effectuate an unconstitutional taking of property or otherwise have an unconstitutional application to the property. The applicant shall bear the burden of presenting evidence to support a waiver or modification request under this Section and shall set forth in detail the factual and legal basis for the claim, including all supporting technical documentation. Any such request under this section shall be submitted to the Planning and Community Development Director together with an economic analysis or other supporting documentation and shall be acted upon by the City Council. 18.85.206 Procedures for Reviewing Qualifying Applications. The following additional processing and approval requirements shall apply to Office Annual Limit Land Uses: (a) No Qualifying Application for an Office Annual Limit Land Use shall be acted upon by the Director or by the City Council between July 1 and March 31 of the following year. (b) If the combined square footage proposed by all Qualifying Applications that are 151103 cs 0131471 3 Rev. October 1, 2015 DocuSign Envelope ID: 058EA42C-633E-4A 13-9788-084 711 CF4A49 pending on March 31 would not exceed the annual limit, the Qualifying Applications shall be acted upon using the Zoning Code's usual process immediately following March 31. (c) If the combined square footage proposed by all Qualifying Applications would exceed the annual limit, the Director shall rank all Qualifying Applications based on scoring criteria set forth in Section 18.85.207 and make a recommendation to the Council. The Council may accept the Director's recommendation or reevaluate the ranking based on the scoring criteria. Based on their review, the Council shall approve in ranked order one or more Qualifying Applications to achieve a maximum of 50,000 net new square feet. The Council may approve applications as proposed and recommended, and may require modifications of any project to reduce the proposed square footage in order to stay within the 50,000 square feet Office Annual Limit. The Council's action on all Qualifying Applications shall be made before the end of the fiscal year on June 30. (d) Any application which is subject to City Council evaluation and action pursuant to Section (c) above and which was not approved by the City Council shall be denied unless, at the request of the applicant, it is rolled over to the next fiscal year for processing in accordance with the terms of this Ordinance. Further, in lieu of modifications to the project's Office Annual Limit Land Use, the applicant can elect to roll over the application to the next fiscal year. The City and applicant may agree to extend any applicable processing time periods to effectuate this provision. 18.85.207 Selection Criteria. The City Council shall evaluate applications subject to the annual limit using the following criteria based upon weighting set forth in administrative rules or procedures which shall provide that projects meeting criterion (i) shall be selected first and weighted against each other: Impacts (a) The density of the development in the context of underlying zoning and the site surroundings; and (b) The ability to avoid or address potential impacts on traffic and parking; and (c) The quality of design, including the attention to human scale where the building(s) meet the street, the compatibility with surroundings, and the overall architectural quality; and Environmental Quality (d) Environmental quality; and Public Benefit (e) The value to the community of public benefits offered; and 151103 cs 0131471 4 Rev. October 1, 2015 DocuSign Envelope ID: 05BEA42C-633E-4A13-978B-OB4711 CF4A49 (f) Mixed use projects including substantial housing; and (g) Mixed use projects including retail; and (h) Mixed use projects that provide space for cultural amenities such as but not limited to art galleries and studios; and Pipeline Projects (i) Any entitlement application involving an Office Annual Limit Land Use deemed complete by the City between March 31, 2015 and June 15, 2015. 18.85 .208. The Director has the authority to adopt rules or procedures to implement the efficient and equitable implementation of this Ordinance." SECTION 2. Supersede. This Ordinance supersedes any provision of the Palo Alto Municipal Code inconsistent with the provisions of this Ordinance. SECTION 3. Severability. If any provision, clause, sentence or paragraph of this ordinance, or the application to any person or circumstances, shall be held invalid, such invalidity shall not affect the other provisions of this Ordinance which can be given effect without the invalid provision or application and, to this end, the provisions of this Ordinance are hereby declared to be severable. SECTION 4. Effective Date. This ordinance shall be effective on the thirty-first date after the date of its adoption. This ordinance shall expire within two years of its effective date or upon Council adoption of the Comprehensive Plan Update, whichever occurs first. SECTION 5. CEQA. The City Council finds that this Ordinance falls under the California Environmental Quality Act (CEQA) exemption found in Title 14 California Code of Regulations II II II II II II II 151103 cs 0131471 5 Rev. October 1, 2015 DocuSign Envelope ID: 058EA42C-633E-4A 13-9788-084711 CF4A49 Section 15061(b)(3) because it is a temporary measure designed to slow the rate of change in some commercial areas of the City. INTRODUCED: September 21, 2015 PASSED: October 26, 2015 AYES: BERMAN, BURT, DUBOIS, FILSETH, HOLMAN, KNISS, SCHARFF, SCHMID, WOLBACH NOES : ABSTENTIONS: ABSENT: ATIEST: ~ City Clerk APPROVED AS TO FORM: ~~~1~ .. --------------- Senior Assistant City Attorney 151103 cs 0131471 6 APPROVED: Mayor [?:-;;!' 3QFZ2Q8F82064QB City Manager Director of Planning and Community Environment Rev. 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Avenue Donner Lane Almanor Lane Fallen Leaf Street Berryes sa Street Cashel StNoble St Hettinger Ln Pratt Ln Emma Court Galvez Mall Federation Way Abrams Court Allardice Way Alta Road Alvarado CtAlvarado Row Angell Court Arguello Way Arguello Way Avery Mall Ayrshire Farm Lane Barnes CourtBonair Siding Bowdoin Street Cabrillo Avenue Cabrillo Avenue Campus Drive Campus Drive Campus Drive Campus Drive Campus DriveCampus Drive Campus Drive Campus Drive Campus Drive Campus Drive Campus Drive Campus DriveCampus Drive Campus Drive Capistrano Way Casanueva Place Cathcart Way Cedro Way Cedro Way Churchill Mall Comstock Circle Aboretum Road Aboretum Road Blackwelder Court Campus Drive Cathcart Way Constanzo Street Cooksey Lane Coronado Avenue Cottrell Way Cottrell Way Cowell Ln Crothers Way Dolores Street Dolores Street Dudley Lane Duena Street Electioneer Road Escondido Mall Escondido Mall Escondido Road Escondido Road Escondido Road Esplanada Way Estudillo Road Fremont Road Frenchmans Road Frenchmans Road Galvez Mall Alvarado Row Galvez Street Galvez Street Galvez Street Gerona Road Gerona Road El Escarpado Gerona Road Hoskins Court Hulme Court JenkinsCourt Junipero Serra Boulevard Junipero Serra Boulevard Junipero Serra Boulevard Junipero Serra Boulevard Knight Way Lagunita Drive Lane L L ane W Lasuen Mall Lasuen Mall Lasuen Mall Lasuen Street Lathrop Drive Lathrop Drive Lathrop Place Lathrop Drive Links RoadLinks Road Lomita Drive Lomita Drive Lomita Drive Lomita Drive Lomita DriveLomitaCourt Lom ita Mall Los Arboles Avenue Masters Mall Mayfield Avenue Mayfield Avenue Mayfield Avenue Mayfield Avenue Mayfield Avenue Mayfield Avenue McFarland Court Mears CourtMears Court Memorial Way Mirada Avenue Mirada Avenue Museum Way N Service Road N Tolman Ln Nelson Mall Nelson Road North-South Axis Oberlin St Comstock Circle Escondido Mall Olmsted Road Olmsted Road Olmsted Road Olmsted Road Olmsted Road Palm Drive Palm Drive Pampas Lane Panama Mall Panama Mall Panama Street Panama Street Pearce Mitchell Pl Peter Coutts Circle Peter Coutts Road Peter Coutts Road Pine Hill Court Pine Hill Road Quarry Extension Quarry Road Quillen Ct Raimundo Way Rai mundo Wa y Raimundo Way Roble Drive Rosse Lane Roth Way Roth Way Roth Way Running Farm Lane Ryan Court S Service Road S Tolman Ln Salvatierra Street Salvatierra St Salvatierra W alk Samuel Morris Wy San Francisco Terrace San Francisco CourtSan Juan St San Juan St San Rafael Pl Santa Fe Avenue Santa Maria Avenue Santa Teresa Street Santa Teresa Street Santa Ynez Street Searsville Road Sequoia Wy Serra Mall Serra Street Serra Street Serra Street Sonoma Terrace Stanford Avenue Stanford Avenue Stock Farm Road Thoburn Court Tolman DriveValdez Place Valparaiso Street Vernier Place Via Ortega Via Palou Via Pueblo Mall Welch Road Wellesley St Wilbur Way Wing Place Yale St Alma Street Alma Street Alma Street Alma Street Alma Street Hawthorne Avenue Lytton Avenue Alpine Access Road Nathan Abbott Way Sam McDonald Road Sam McDonald Mall Vista Lane Bowdoin Lane Arguello Way Governors Avenue Governors Avenue Governors Avenue S Governors Lane Pasteur Drive Lagunita Drive Alma Village Lane Alma Village Circle R e s e r v oir R o a d Reservoir Road Reservoir Road Ranch Road Ryan Lane O'Connor Lane Gene CtBrassinga Ct Cole Ct Birch Street Arboretum Road Welch RoadPasteur Drive Pasteur Drive This map is a product of the City of Palo Alto GIS This document is a graphic representation only of best available sources. Legend Commercial & RT Zoning Districts - Office is a Permitted Use w/ Possible GF & Size Limitations ROLM & RP Zoning Districts - Office and R & D is a Permitted Use MOR Zoning District - Medical Office is a Permitted Use PF Zoning District - Office is a Conditional Use GM Zoning District - R & D is a Permitted Use & Office is a Conditional Use Stanford Research Park Annual Office and R&D Cap Area Boundaries City Jurisdictional Limits abc Note: Other uses where Office may be an "accessory use" maybe conditionally permitted in Residential Zoning Districts 0'2200' Of f i c e a n d R & D An n u a l C a p B o u n d a r i e s Ar e a M a p CITY O F PALO A L TO I N C O R P O R ATE D C ALIFOR N IA P a l o A l t oT h e C i t y o f A P RIL 16 1894 The City of Palo Alto assumes no responsibility for any errors. ©1989 to 2015 City of Palo AltoRRivera, 2015-10-01 11:54:38 (\\cc-maps\gis$\gis\admin\meta\view.mdb) Exhibit A Certificate Of Completion Envelope Number: 058EA42C633E4A 139788084 711 CF4A49 Subject: Please DocuSign this document: ORD 5357 Office Growth Meter October 1 2015.pdf Source Envelope: Document Pages: 6 Certificate Pages: 5 AutoNav: Enabled Envelopeld Stamping: Enabled Record Tracking Status: Original 11/3/201510:58:11 AM PT Signer Events Cara Silver cara.silver@cityofpaloalto.org Senior Assistant City Attorney City of Palo Alto Security Level: Email, Account Authentication (None) Electronic Record and Signature Disclosure: Accepted: 7/15/2015 5:07:16 PM PT ID: 11910ed1-61d1-4ff3-9cf9-f4eb5a0768e2 Hillary Gitelman Hillary.Gitelman@CityofPaloAito.org Security Level: Email, Account Authentication (None) Electronic Record and Signature Disclosure: Not Offered ID: James Keene james.keene@cityofpaloalto.org City Manager City of Palo Alto Security Level: Email, Account Authentication (None) Electronic Record and Signature Disclosure: Accepted: 4/14/2015 5:40:07 PM PT I D: 44fe333a-6a81-4cb 7 -b 7 d4-9254 73ac82e3 In Person Signer Events Editor Delivery Events Agent Delivery Events Intermediary Delivery Events Signatures: 3 Initials: 0 Holder: Kim Lunt kimberly.lunt@cityofpaloalto.org Signature ((DocuSigned by; ~:.0~:::,. Using IP Address: 199.33.32.254 ('UDocuSigned by: ~::;,.:~~ Using IP Address: 199.33.32.254 Using IP Address: 199.33.32.254 Signature Status Status Status Docu~. iii SiCU.lD Status: Completed Envelope Originator: Kim Lunt 250 Hamilton Ave Palo Alto , CA 94301 kimberly.lunt@cityofpaloalto.org IP Address: 199.33 .32.254 Location: DocuSign Timestamp Sent: 11/3/201511:01:21 AM PT Viewed: 11/3/2015 11 :27:49 AM PT Signed: 11/3/201512:46:40 PM PT Sent: 11/3/2015 12:46:41 PM PT Viewed: 11/3/2015 12:50:43 PM PT Signed: 11/3/201512:51 :05 PM PT Sent: 11/3/2015 12:51 :07 PM PT Viewed: 11/13/2015 2:33:24 PM PT Signed: 11/13/2015 2:33:32 PM PT Timestamp Timestamp Timestamp Timestamp INTERIM OFFICE/R&D ANNUAL LIMIT GUIDELINE Revised February17, 2016 Page 1 CITY OF PALO ALTO INTERIM OFFICE/R&D ANNUAL LIMIT GUIDELINE February 17, 2016 Pursuant to the authority granted by Palo Alto Municipal Code (“PAMC”) Section 18.85.208, the following Interim Office/R&D Annual Limit Program Guideline (“Guideline”) is hereby adopted and determined to be desirable for the implementation and enforcement of PAMC Section 18.85.200 (Annual Office Limit) of PAMC Chapter 18.85 (Interim Zoning Ordinances). All defined terms used in this Guideline shall have the meaning set forth in PAMC Section 18.85.201. Overview: The purpose of this Guideline is to implement the annual limit on Office/R&D development adopted by Ordinance Number 5357 on October 26, 2015. The annual limit was adopted on an interim basis for two years (until November 26, 2017) or until the Comprehensive Plan Update is completed, whichever occurs first. No more than 50,000 gross square feet of new Office/R&D development can be approved within a given fiscal year in the subset of the City shown in Attachment A and adopted as Exhibit A of Ordinance 5357. This Guideline is intended to implement the interim annual limit in Fiscal Year 2015/16 and Fiscal Year 2016/17. Program Guideline: A. Applicability. This Interim Office/R&D Annual Limit Program Guideline is applicable to all discretionary development applications proposing an increase in gross square footage devoted to one or more of the following uses,1 when the site is located within the area shown on Exhibit A of Ordinance 5357: • Research & Development as defined in PAMC Section 18.04.030(123) • Administrative Office Services as defined in PAMC Section 18.04.030(6) • General Business Office as defined in PAMC Section 18.04.030(61) • Medical Office as defined in PAMC Section 18.04.030(95) • Professional Office as defined in PAMC Section 18.04.030(116). Building permit applications and associated use and occupancy certificates are not discretionary and applications proposing use or reuse of existing building space via non-discretionary applications are not subject to the Interim Office/R&D Annual Limit. B. Exemptions. Exempted applications, as defined below, shall be processed in accordance with applicable sections of the PAMC without regard to the 1 The text of the cited definitions is included in Attachment B. INTERIM OFFICE/R&D ANNUAL LIMIT GUIDELINE Revised February17, 2016 Page 2 procedures established by this Guideline. The decision to approve or disapprove such applications shall be appealable to the City Council in accordance with existing provisions of the PAMC. An applicant may request in writing a formal determination that a pending application is exempt pursuant to one of the exemptions outlined below at any time. The resulting written determination shall be considered a code interpretation that is appealable to the City Council consistent with Section 18.01.025 of the PAMC. 1. Accessory office space that is incidental to and customarily associated with a principal use or facility. Examples include a small office space used in conjunction with a retail establishment, a hotel, a school, or a religious institution. 2. City office space. 3. Any application proposing less than 2,000 new gross square feet of Research & Development, Administrative Office Services, General Business Office, and/or Professional Office, where such application does not also involve the Medical Office exemption in item (4) below. 4. Any application proposing a project containing less than 5,000 new gross square feet of Medical Office, where such application does not also involve the exemption in item (3) above. 5. “Pipeline Projects” as follows: a. Projects which obtained a planning entitlement prior to the effective date of Ordinance 5357 (November 25, 2015). b. Projects which are the subject of a planning entitlement application that was submitted to the City in 2013 or 2014 and deemed complete by the City on or before March 31, 2015. C. “Self-Mitigating Projects” which provide rental housing for more members of the workforce than would be employed in the project, and which provide substantial transportation demand management (TDM) strategies either individually or in combination with other projects or programs such that parking and traffic conditions in the site vicinity would be improved. D. Economic Hardship Waiver or Adjustment. An applicant may request that requirements of Ordinance 5357 be adjusted or waived based upon showing that applying the requirements of Ordinance 5357 would effectuate an unconstitutional taking of property or otherwise have an unconstitutional application to the property. INTERIM OFFICE/R&D ANNUAL LIMIT GUIDELINE Revised February17, 2016 Page 3 1. The applicant shall bear the burden of presenting evidence to support a hardship-related waiver or modification and shall submit an economic analysis along with an explanation of the factual and legal basis for the claim to the Director of Planning. 2. The Director of Planning shall review the request and forward it to the City Council with a recommendation within 60 days. The City Council shall consider the request at a noticed public meeting, along with the economic analysis and the Director’s recommendation, and provide a final decision to grant or deny the request. E. Processing and review of applications subject to the Interim Office/R&D Annual Limit. 1. Applications subject to the Interim Office/R&D Annual Limit shall be processed in accordance with the PAMC and the California Environmental Quality Act (CEQA), except that neither the Director of Planning nor the City Council shall adopt the CEQA document or act upon any such applications between July 1 and March 31 of each year. 2. The Director of Planning shall review all such applications that are pending final action by the Director of Planning or City Council as of the close of business on March 31 of each year, and determine which applications are eligible for consideration. a. Pending applications only become eligible for consideration if they have been recommended for approval by the Architectural Review Board (ARB) and the Planning & Transportation Commission (PTC – for Site and Design and rezoning applications only), and if review pursuant to CEQA has been completed. For purposes of this section, subdivision requests accompanying entitlement applications do not need to be submitted or processed. b. Applications that are not eligible for consideration at the close of business on March 31 will be reviewed for eligibility in the following fiscal year unless the 50,000 square foot annual limit has not been reached as described in paragraph (c) below. In this case, additional applications may become eligible and be considered between March 31 and June 30, as long as the 50,000 square foot annual limit is not reached. 3. If the sum total of new square footage proposed by all eligible applications on the close of business on March 31 is 50,000 square feet or less, all of the applications will be acted upon by the approving authority established in the PAMC. For example, the Director of Planning would act upon Architectural Review applications, and that action would be appealable to the City Council. INTERIM OFFICE/R&D ANNUAL LIMIT GUIDELINE Revised February17, 2016 Page 4 The City Council would act upon applications requiring Site and Design or rezoning. 4. If the sum total of new square footage proposed by all eligible applications on the close of business on March 31 is greater than 50,000 square feet, the Director of Planning shall prepare the applications for hearing by the City Council as follows: a. At an initial hearing, the Director shall provide the City Council with all pending applications, including required CEQA documents, recommended findings and conditions of approval. Each applicant will be invited to present their project at the initial hearing, and the City Council may provide comments and direction regarding the recommended findings and conditions. The initial review of the eligible projects by the City Council may be spread over more than one meeting if time does not allow review of all projects on one meeting agenda. i. If the City Council is unable to support approval of the required CEQA document or the required findings for any of the eligible projects, it may direct staff to prepare findings for denial or impose conditions that will permit it to make the necessary findings. ii. Projects that are denied based upon not meeting required findings for approval are no longer eligible projects and the applicant must submit a new planning entitlement for a substantially different project for proposed development at the same site. b. At a second public hearing, the Director shall provide the City Council with a recommended ranking of the eligible applications using the scoring criteria included below. The Director may convene a panel consisting of the Chair of the ARB and the Chair of the PTC to assist in the ranking. At the second public hearing, the City Council shall review the Director’s recommendation and select the projects that shall receive an office/R&D allocation. The projects selected shall receive planning entitlement approval at the same hearing, which shall occur before the end of the fiscal year on June 30. The City Council shall approve, deny, or approve as modified the project(s) receiving an office/R&D allocation. c. Any application that is not approved by the City Council solely because it exceeds the office/R&D allocation shall be denied unless the applicant requests that the project be rolled over for consideration in the next fiscal year. In addition, the applicant may request his/her application be rolled over to the next fiscal year if the City Council INTERIM OFFICE/R&D ANNUAL LIMIT GUIDELINE Revised February17, 2016 Page 5 proposes to modify the project by reducing its square footage and the applicant declines to do so. A project can be rolled over only one time. F. Expiration of Office/R&D Allocation. Once a project has been approved, all applicable entitlement timelines apply to the project, including the expiration of approvals. If an entitlement expires, the approved allocation also expires. The allocation cannot be carried over to another development proposal; it must be used for the approved project or it will be lost. G. Review Criteria and Scoring. 1. Eligible applications that were deemed complete by the City between March 31 and June 15, 2015 shall have priority over other projects and shall be evaluated against each other and granted an allocation before other eligible applications are considered 2. Review criteria are established in Ordinance 5347 as follows: Impacts a. The density of the development in the context of underlying zoning and the site surroundings; and b. The ability to avoid or address potential impacts on traffic and parking; Design c. The quality of design, including the attention to human scale where the building(s) meet the street, the compatibility with surroundings, and the overall architectural quality; and Environmental Quality d. Environmental quality Public Benefit e. The value to the community of public benefits offered; and Uses f. Mixed use projects including substantial housing; and g. Mixed use projects including retail; and h. Mixed use projects that provide space for cultural amenities such as but not limited to art galleries and studios 3. The Director’s recommendation shall be based on an evaluation of eligible applications weighting the review criteria as shown in the score card in Table 1, below. All projects will be ranked against each other according to the point totals they receive. 4. The City Council may accept the Director’s recommendation or modify it based on its independent review of the criteria, and shall determine which eligible applications will be approved, approved with modifications, or INTERIM OFFICE/R&D ANNUAL LIMIT GUIDELINE Revised February17, 2016 Page 6 denied, such that the total square footage approved does not exceed 50,000 new gross square feet of the uses listed in Section A, above. INTERIM OFFICE/R&D ANNUAL LIMIT GUIDELINE Revised February17, 2016 Page 7 Table 1. Interim Office/R&D Annual Limit Scoring (One Score Card Shall be Used to Evaluate Each Eligible Application) Project Address and APN: Net New Square Footage Requested: Brief Project Description: Scoring Criterion Total Possible Score Considerations for Each Criterion Project Score Explanation 1. Impacts 30 a. The density of the development in the context of underlying zoning and the site surroundings 10 Projects will be ranked against each other, with the most points awarded to the project that does not require variances or exceptions from applicable quantitative standards of the code and that is deemed to be most consistent in terms of its mass and scale with nearby buildings. 1 b. The ability to avoid or address potential impacts on traffic and parking 20 Projects will be ranked against each other, with the most points awarded to the project resulting in the least traffic and the least potential for unmet parking demand, regardless of whether these impacts are considered significant pursuant to CEQA. 2. Design 20 c. The quality of design, including the attention to human scale where the building(s) meet the street, the compatibility with surroundings, and the overall architectural quality 20 Projects will be ranked against each other, with the most points awarded to the project with the highest quality of design. Rankings will consider how the buildings address the street and their compatibility with surrounding buildings. INTERIM OFFICE/R&D ANNUAL LIMIT GUIDELINE Revised February17, 2016 Page 8 Scoring Criterion Total Possible Score Considerations for Each Criterion Project Score Explanation 3. Environmental Quality 20 a. Environmental quality 20 Projects will be ranked against each other, with the most points awarded to project that avoids significant environmental impacts under CEQA and that is designed to enhance the built and natural environment. Enhancements may include, but are not limited to, incorporation of energy conservation, storm water, and sustainability features above and beyond legal requirements, as well as incorporation of vegetation/landscaping and bird friendly design. 4. Public Benefit 20 b. The value to the community of public benefits offered 20 Eligible projects will be compared to each other in terms of their value to the community, with the top project receiving up to 20 points and other projects receiving lower rankings based on their relative benefits. For purposes of this section, the value of public benefits may be qualitative or quantitative.2 5. Uses 20 c. Mixed use projects including substantial housing 10 Projects will be ranked against each other with the most points awarded to the project with the greatest number of dwelling units.3 d. Mixed use projects including retail 5 Projects will be ranked against each other based on their mix of uses, including the quantity of ground floor retail.3 e. Mixed use projects that provide space for cultural amenities such as but not limited to art galleries and studios 5 Projects will be ranked against each other based on their mix of uses, including retail or personal services uses (galleries or studios) for use by artists, or space for other cultural uses. A project’s public art requirement does not count towards this.3 INTERIM OFFICE/R&D ANNUAL LIMIT GUIDELINE Revised February17, 2016 Page 9 Notes: 1. For purposes of this section, exceptions to the “Build to Line” standard and requests for parking reductions per PAMC Section 18.52.050 shall not be considered. Section 18.52.050 can be used to allow parking adjustments based on provision of on-site amenities, shared parking, senior housing, affordable housing, housing near transit, and TDM plans. 2. Benefits may be intrinsic to the project, such as affordable housing units, publicly accessible open spaces, publicly accessible off-street parking, community meeting space, or subsidized rent for community-serving non-profits. Benefits may also be extrinsic improvements or voluntary financial contributions to larger community initiatives. Some benefits may be quantifiable and some may not. 3. By rewarding provision of uses that may not be permitted in all zoning districts, this section effectively gives some priority to those projects that are proposed within districts that allow the desired uses (when those uses are incorporated into the proposed project). INTERIM OFFICE/R&D ANNUAL LIMIT GUIDELINE Revised February17, 2016 Page 10 Attachment A Map of Areas Subject to the Interim Office/R&D Annual Limit Attachment B Definitions of Relevant Office and R&D Uses from the Palo Alto Zoning Ordinance Land Use Code Section Definition Research & Development 18.04.030(123) "Research and development" means a use engaged in the study, testing, engineering, product design, analysis and development of devices, products, processes, or services related to current or new technologies. Research and development may include limited manufacturing, fabricating, processing, assembling or storage of prototypes, devices, compounds, products or materials, or similar related activities, where such activities are incidental to research, development or evaluation. Examples of "research and development" uses include, but are not limited to, computer software and hardware firms, computer peripherals and related products, electronic research firms, biotechnical and biomedical firms, instrument analysis, genomics, robotics and pharmaceutical research laboratories, and related educational development. Research and development may include the storage or use of hazardous materials in excess of the exempt quantities listed in Title 15 of the Municipal Code, or etiological (biological) agents up to and including Risk Group 3 or Bio Safety Level 3 classifications as defined by the National Institute of Health (NIH) or the Center for Disease Control (CDC). Higher classification levels of etiological (biological) agents are not allowed without express permission of the City Manager, Fire Chief, and Police Chief. Related administrative uses such as finance, legal, human resources, management, marketing, sales, accounting, purchasing, or corporate offices; provisions of services to others on or off-site; and related educational uses may also be included provided they remain primarily supportive of the primary uses of "research and development" and are part of the same research and development firm. Administrative Office Services 18.040.030(6) "Administrative office services" means offices and service facilities performing headquarters, regional, or other level management and administrative services for firms and institutions. General Business Office 18.040.030(61) "General business office" means a use principally providing services to individuals, firms, or other entities, including but not limited to real estate, insurance, property management, title companies, investment, personnel, travel, and similar services. Medical Office 18.04.030(95) "Medical office" means a use providing consultation, diagnosis, therapeutic, preventive, or corrective personal treatment services by doctors, dentists, medical and dental laboratories, and similar practitioners of medical and healing arts for humans, licensed for such practice by the state of California. Incidental medical and/or dental research within the office is considered part of the office use, where it supports the on-site patient services. Medical office use does not include the storage or use of hazardous materials in excess of the permit quantities as defined in Title 15 of the Municipal Code. Medical gas storage or use shall be allowed up to 1,008 cubic feet per gas type and flammable liquids storage and use shall be INTERIM OFFICE/R&D ANNUAL LIMIT GUIDELINE Revised February17, 2016 Page 12 Land Use Code Section Definition allowed up to 20 gallons total (including waste). Professional Office 18.04.030(116) "Professional office" means a use providing professional or consulting services in the fields of law, architecture and architectural design, engineering, accounting, and similar professions, including associated product testing and prototype development, but excluding product manufacturing or assembly and excluding the storage or use of hazardous materials in excess of permit quantities prescribed in Title 15 of the Municipal Code.