HomeMy WebLinkAbout0246.091t
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May 9, 1991
THE HONORABLE CITY COUNCIL
Palo Alto" California
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Attention: Finance and PUblic Works committee
BCOJIQIIXC Ol!TLOOk OOIllU1'TEE Ml!ETING OP JIlU!C11 ~. 1991
Members of the council:
This is an informational report; no council action is nece5sary~
Report in Brief
The Economic OUtlook Committee (EOC) was formed in 1989 by the
Finance Director to provide insight on issues in the local economy
that aight affect the City's budget, and to provide a forum tor
business leaders to offer feedback on City services~ The EOC is
co.prised of City staff members and business leaders 'from the local
community. The committe.e meets quarterly to discuss topics of.
economic concern to local government and businesses~ Attached are
minutes of the latest EOC meeting. The Finance and PUblic WOrF$
committee requested that minutes from SOC meetings be forwarded to
thea as an in!onaat.ional item. Topics covered at the March lIIeetinq
included Council Member Hike Cobb's views on Palo Alto's economic
future J and a review of the City's Midyear Financial Report.
Respectfully submitted~
CMR:246:91
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ECONOMIC OUTLOOK COMMITTEE MINUTES
March 1, 1991
Attendees: David Longbine, Stanford Shoppinq Center; Edif~ Dorosin,
Ch41llber of cOllUle-rce; Charles Ke.enan, J:eenan Land. Company; Andy
OCty, Stanford Univp.rsity; Marcel cohen, Hewlett-Packard; Micki
SChneider" Spirals; Doug Burns, vari&nj stanford University, Office.
of )teal Estate and Lands Mllnaqement: Diane Healy and Zera Mur'phy;
Palo Alto City Council Members: Mike Cobb, Le Levy and Jean
:McCown; City of Palo Alto staff members~ Emily Harrison, Libby
Dame, Ken Schreiber, Rich Young, George Zim=erman~
cotJNCIL MEMBER MII(E COBB: PALO ALTO'S ECONOMIC FUTURE
council XeJDber Cobb qave a pre;;entation on his .. "leW' of Palo Alto' 5
economic future, stating that the issue of Palo Alto's economic
future was established as a Council priority in 1989-90. He
emphasized that the followIng represents his personal viewpoint
rather tha.n that of the f\'ll council.
Council ){e»Iber Cobb see~ that all California cities are at a
critical eCQnomic juncture tor several reasons:
o There is a growing movement toward regional qovernment,
which will erode lOCAl control;
o There are increasinq financial burdens being passed down
by the state which erode the City's financial base: and
o There is a movement to levelize. sale.s tax on a per capita
basis.
Council Member cobb sees Palo Alto at a particularly critical
-crossroads-right now, where the direction the city chooses ~ill
determine the City's economic future. The service levels offered
in this City are probably some of the hiqhest in the state. Palo
Alto residants have become accustomed to that level of service .. and
have qrown to expect it. However, City staff are currently in ~he
process of cutting $2 million from the existing budget. Such cuts
will probably have a larqe impact this year--for the first time,
services could be drastically cut, and th~ public will notice such
cuts.. council Member Cobb believes that if the City takes a
proactive approach to the economy, it could continue to offer high
levels of service while still .akinq the necessary budget cuts.
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As Mayor last year, Council Member Cobb had an opportunity to take
some &.tepa toward economic outreach. He met with many local
businesses to explore a variety of economic issues. He askEd top
executives about the.ir business relationships with the City and
a~ked for any specitic problems they lIiqht have. Why did they
choose to locate in Palo Alto? Do they want to stay? Wbat do they
se.e as the issues for the future? Tha. COInmOn themes that arose
from these aeetinqs include:
o Th~re are problems between the City and local businesses,
but they are resolvable;
o Most companies ~ want to stay in Palo Alto;
o Some companies' sales offices may b4 leavinq Palo Alto,
although most companies are willing to work wi th the city
to keep sales here;
o Palo Alto is perceived as tou9h to deal with, discourag
ing positive redevelopment. There is a need to expedite
the process;
o Firms are willing to work with the city in an active
pa.rtnership. Tbe city needs to brinq its own staff,
Stanford university and the businesses together.
Nov that the doors of communication with businesses have been
opened, and now that the city is in the process of making ser~ice
level cuts, Council Member Cobb sees the present as a window of
opportuni.ty for activity. The pUblic needs to become .aware of the
problem. Palo Al to residents cSo not appreciate the reve:1ues
brouqht in by businesses, because they have not yet felt the impact
of decreasing such revenYes. Once they see the effects of budget
cuts on programs that they like and expect, then they ~ill realize
the interaction between busir.esses and the City budget.
This year, one of the City council's priorities is dealing with
regional issues.. Palo Alto's economic actions impact its neighbors
and that impact needs to be taken into account wben making economic
decisions ..
Council Member cobb believes 'We should treat Palo Alto as· an
econo.ic ·system~, and he used his ideas for the Stanford Research
Park as an example.. To make the Park a ·system-he would:
o establish a transportation hub. Make it easy for people
to use public transportation to and from the Park;
o tie in a meeting center for the area;
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connect a childcare facility;
use electric vehicles for a shuttle service and lif'J.k to
nearby areas such as Stanford, the Medical center,
shoppinq, etc.;
brinq in recreational facilities and restanrants;
tie into East Palo Alto's labor pool and available
commercial land.
Such a systeu could result in hiqher revenues for the City vhile
producing less tr~ffic, a safer enviro~ent and a Eore aesthetic
Park, thus keeping the Stanford Park as a state-of-the-art Research
Park which is attractive to businesses.
":':1.8 city COllncil appreved his idea to pull together a Business Task
Yorce, comprised of high-level business community members, to
discuss some of these cco~ic issues. Council Member Cobb hopes
that the group will function as a catalyst to gatting some action
qoinq on issues dealing ~ith the Stanford Research Park, El Camino
Real, California Avenue and others. He realizes that there will be
soge economic and political costs associated with all of the
d~ci8ion5, but the people of Pa.lo Alto and the Palo Alto city
council need to face the issues.
council X8mber Cobb concluded his talk by emphasizinq that now is
the. opportune ti1Sl.e. for action. If the City does zaxe some-changes,
it will be seen as visionary, keeping Palo Alto on the forefront ot
cities.
pISCUSSION OF CITY'S ECONOMIC FUTURE
Zera XUrphy, of S~anford University's Office of Real Estate, talked
about. the Stanford Research Park and its competition from other
research parks across the nation. She spent some time last year
travelling to visit research parks in Boulder~ Colorado; Austin,
Texas and Orlando, Florida, and was quite impressed. The sites all
have communities that are very active in economic development and
supportive of businesses. They \iork hard to make strong t;ies
between the universities and loca~ companies, and provide -incuba
tor-facilities for small start-ups. The cost of living in these
areas is quite a bit lower than that of the Bay .Area. Zera
attributes the main difference in attitude as due to the tact that
these other places have known hardship and realize the impo~tance
of providing a supportive anvironment for businesses. Palo Alto
has not experienced such hardship. She also saw other areas as
trying to create local jobs, something that Palo Alto is not
attemptinq to do. She thinks that, to keep Palo Alto's economic
future strong. Palo Alto residents will need to be more supportive
of bUsiness.
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Chop Keenan had It couple of comme.nts regarding Council Member
Cobb's observations about the general. -econo1lt;ic forces impactin9
cit!... As the levels ot qovernment are passinq on costs to the
next-lowe.st level of qovernme.nt, eities .are in turn passinq en
costs to developers and businesses in various forms. He expressed
some concern about regionalis~ and the problems it can cause~ He
believes that there are regional organizations already in place to
handle regional issues~ 8e is concerned that residents already
teel that they bave no cdntrol over any level or 90vernment, except
at the local levela LoCi'.lly, residents can talk to Council Members
to qet action and resolution. A regional approach does not allow
that interaction. palo Alto is special--with the Stanford
Shopping Cer.ter, the stanford Medical Center, and the Palo Alto
Medical Clinic. The good neys is also that the city has started to
do some econo.ic outreach such as yhat vas done at the stanford
Research Park. The businesses appreciated that contact; it shows
that the city caces.
Edie Dorosin emphasized that businesses need to see results ana
follow-up frOil the initial outreach efforts. To have a real
impact, the City and Stanford University should jOin forces.
Ken Schreiber commented that it is critical that the private sector
remain very active in coming up with solutions to local proble~s.
It will not work to have qove.rnment or the University forcing
solutions on the businesses. Companies need to design the process
for all to participate in.
council Member Cobb hopad that the BU5iness Task Force would help
serve in that capacity. He would like to see a joint presentation
.ade by ~e City Manager, ~illiam Zaner and Stanford's president,
Don Xennedy at the first Deeting. Then the qroup could produce an
agenda for th~ followinq ye..ar to plan a. political process that 'Will
create action items.
CITV'S MIPXEAR FINANCIAL REPCRT
£lilly Harrison briefly revieved the city's Midyear Financial
Sumaary and Capital Improvement Program Financia~ Status Report.
The report details revenue, expense, and reserve level changes from
the budget for the General and Enterprise FUnds for fiscal year
1990-91i' and raviews selected capital projects. She mentioned that
staff is currently looking at potential budget reductions fo~ next
year.
NEXT MEETING
The next meeting of the Economic OUtlook Committee is scheduled for
Thursd.a1, June 6 from 1.0:{)G a~1I. to noon~ Sy that time, the
Financa Department will have completed their summary report of the
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economic outreacb interviews with the stanford Research Park, and
will have held a meating with the participants of that study~
Stanford expects to alac-hay. some information available from their
study at the Stanford Research Park.
Minutes prepared by Libby Dame, Senior Financial Analyst.
Attachment: Article. frOll The Peninsula Times Tribune:
Plans to Boost Economy·, about the city of
vale's economic development strategy_
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_av, ApnT 17, 1991-8-9
City plans to boost economy
ROSANNE SPECTOR I STAFF
8IJOIti1YALI
No km&eT lmpervtcus to reees
lloa.. SuftJlyvale hll."~ tasbloned I
strateIY to build up Irs ecor.oIDy.
SWmyvWe Cly CoutlcD memllcers
approlJ'ef:l an eccno mic: dev!'Jop
metU strategy for the clty IU OJelr _ Tuesday Oight
Acconflog to Economic t>evel
opment W&Dager GeTi Cross, tile
City's rne-aues ba-ve (arlen be
cause of dtangiag tal methods as
weJ! as lOSS of bll:SUlesses due to
bip costs for labor, development,
aod land. increase<j tratflc: and
stronger eovlronm eotal regllta.0 ..
AJtboagIl omer Bay Area cities
face Slm!IaT d.rcumsta.tlces, ~y
hav!, ste,pped tip ttleu-economIc: cJeve_ procrams.
"'Some or oQt major Industries
ten gs tlzat they recelye at Je&s:I:
two caD:s or visits ead. weel; from
otber ejtifS,. counties and coun
b1es Wbo Offer k)wer rabor rates,
Jess tratfic congestiOI:l,. affordable
IwWilD& and OC'CaSloDsfly reloce
tiOD fioanda! l!l~ntiv~" Cress
1<!j)Ort.d.
The City Clxloctl -:leaded .it .-as
time to cQUJlter Sunnyvale's eeo
DOmlC .sIlde wUh a little reCJ1.lit·
melU and razzle dazzle of its own.
!be ptaD eans for eanytng out
tH OowotawD Plan a.M creating
progratllS to attract and DurtUr't
L r
b-.sses.
The plaD cans ror addiliocs sudl
as baMers, tiglUing and dL-ect:ioo
Ii slIZlS poJntlng the way to down
town.
To foster exi5tini busiliesses Ule
strategy calls for actioas sue!! as
establlst!J 08 b~D.ess assistaace
prDlf1UDS. One stldI program i! a
proposed ban): eo~rtiilm to give
money to small bus:iMSSeS,
To attract new busices5eS tbe
city plans to ll".ari:et itself IIsl.og
brodlures graeed WIth a Dew logo..
Two themes tinder consi dera
tiOD are: "The SucZlyvaJe AIto'all
!:a#" aDd "The Sunuyvale Ditter
eftCe,-
The program req~ aM.hOD
at tllDc1i ng 01 $87,OO(l to the cur·
reDlll03(,S2G ecocomic c1eveJop
mtllt budget for 1991--9Z. ot the
~tiQnal moo.ey. $tO,DOO !s tar·
Betted lor ooe-t:lme costs of st\!
d"ies Including Qce QC attracticl!:
business to Mwpby Avenue.
T1le strategy has ttle backing of
tbe Sunnyvale Cbamber of Corn
me=.
--nus !s sometbing Ol~ chamber
lOO perteDt CODeun With," :said
Mel SoIomoD,. e.tet'Uti'le d1re<;tgr
ot t21e SwmyvaJe Chambe:r ot Com
II>OTCO.
fD otber business. the cO\lncil
adopte( a soar of 2S pertttlt water
US8ae reductio II; b&Se1l 00 19~ 7
usap: acd proi:nblted Don-essentia!
IlSeS 01 water.
NOL~tlal U3eS iDcJude: "..
tenn&: lawns so tbat water nuu
dOWll the guau; waslWlgau'S "ilh
drUl.kiD& ..... ter Wll5 the-hose-ts
eqtIlwed witb an automatic shut·
of! Y81Ve,: using <1rtnkio.& water III
fill deCQratlo;e fountains, uless
Ule fOIolDWn reclretllates tbe same
1J&ter, wateriaa: tawm 4UrtDg Pa
Cific Daylight Tlme betWH'1I •
.. m. and , 'p,m.; offerinl a Jla,ss of
water at a restaurant exeo!pC: upo!l
reqyest; and wat~ lOll CO!l!'SeS.
wi tt. the exceptiOD of tee areas,
IandUlg areas anc:,greens.
It residents or bUSitleses repea
tei!!y break Ule ordinBDce tlIeJ
ruk lbe mtanaaoD o.r 'floW' resuic·
tors 011 their 'ilrale.r $I.lppBc$. The
council b.eld off adoptic8 ... ler
rates Since the e~ty'5 .. ter stipp!}.
en., which Include !he Santa Clara
,,'aJ1e:y Waler DistTId IDd !%It Sa4
Francisco Water Pe-l!artment,
bave not yet :let their .PJke:s. k-
0>1'IfillI to F..eld Servh:e Stlpe:rm..
lett4eDt BU] 1r'eise1:ld, tbese 'prke
sbould be available by Ule end of
AprIl. Also, the eolUldl mowd III
,gi\'e S I,DOC to a group trylq to
iure the 19!}.f "'·orld Cap socce:'
dlampiollSb.lp to the Bay Area. An
voted m ra'lQr of tbe cIona.tfot:l 9-
apt tor Cou.r.cilman Mad; Kanica.
wt!o said be llIoupt the actioc
warranted more SCTtlIiD:Y. Tbe
matter-was bf"Ql,lghl 1:11' ror Cle.ftlST:
time at Tuesday's meetIng lad
\'Oted OD immediately.
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