HomeMy WebLinkAbout0456.094.. City of Palo Alto
City Manager's Summary Report ----~-~---,---~------------_. -----------------
TO:
ATI'ENTION:
HONORABLE CI1T COUNCIL
POUCY AND SERVICES CO~rrITEE
FROM: CITY MA."AGER DEP AItThfENT: City}l1M I'"
AGENDA DATE: Odubor 4, ~ eMR: 456:94
On April 5, 1994, the Policy and Stn.'il:es Cornmitta~ '·)Mld.er~j the: ~t.aof~'rJ Rese.arc-h
Park (SRP) Strategic Plail and continued lhc itt-m for fwrtJI;!r '!:taff rni..:w and input from
the community. ir.cluding the Cl:amOcr of Co:nrnerce 3.nd Sunforu Rt' <;.(an.:h rar~ tei1S.1lts,
This report offer! the Fo.icy and Services Ccmmi~ fSJbli~ policy optionl W Loruider
for the Stanford Researcil Park Strnttgic PLo..". 10 oddition, w report also addreHC'5 W
pc'5sibJe economic and fiscoJ impacts of the pr~ Stnt¢gi, Plan.
ru;Co.\IMENDATJONS
Staff =mends that the Policy and Service'5 Committee evaluate w public poIiC-j
options presenttd in this report, and provide staff dear dirtC'jon 00 future actions that
D<'ed to be taken with regard to tie p<opose<l Staoford Resurch Park Strategic Plon.
POlJCY IMPLICATIONS
Policy implications inclode, bot are no( limited to the follow; ng issues:
1) TIle mes..~ge thit City policy rnakf:rs wish to Eive Stanford Urlj\'crsit)' and
Stanford Research Park tu.ants '''garding retention of «i,ting Pari< use, <h,y.lld be
clear. If those messag\'S are not the same for the Unh'<lsity and for the corponIe
rommunity, the diff=nce should be known.
1'01< I or 13
•
•
\
..
.<
-
2) Importance of 'flexibility' to the University in maintaining and promoting o.n
economically viable Research Par:' in the future need. \0 be evalllated, Also, ... e
should evaluate how important the Park's ecooomic health is to the City of Pal a
Alto, .nd what are the pen:eiYOO pro. and ccns to the City of allowing greJfer
flexibility \0 Stanford,
3) The City needs to carefully consider the SRP Strategic Plan', pos,bon thu
additional development is ne=sary for Stanford Research Park to remain
competitive in a world class research park arena. II is important to bear in mind
that "additional-development for IJle Park could mean changes in usc, increases
in allowable square footage, or both,
4) If changes in ialld u;e: entitlements a. ... e !o be. considered for tJ-.e Research Park in
the future, the form lky might take and \0 whom tho)' ,hould be al\ucalW ""J,
10 be determined,
5) Evaluate trade-offs important to the City in considering land U~ policies (or the
Stanford Research Park a.nd the community at lorge, Since issues of traffic and
other environmental considerations may become le·ss important over time dlJ~ to
changes in econom ic eli mate, alternati \'e commute patterns, lower t! mplo~'1!'e rd tias.
or all of lhe above, traditionallaw.l use considerations might not be as Silient to
the City'S review of Research Park development proposab a.s thoy One<' wore, !f
not, then other trade-ofts should be considered,
6) Tho City needs to take • direction regarding discretionary JPPrOval processes for
park tenants; j,e, we can either maintain stat\l.s quo, or move toward greater or
less discretionary review,
SWUord University'S re<lrge.nization has led tu • shift ill focus of the strategic planning
process from external considerations (land usc, design .nd traffic ;.,ues) to internal
considerations, future Park tenanc)" nexus to ongoing Stanford University research efforl.'
and national R&D funding, and Stanford Research ParldUniversity inJ'ra.trucrure and
$UppOrt servi= needs, In addition, Stanford has implicitly recognized the potential value
of the Park to the University's inoome stream.
.....2OCl.l
~----
III staff's opinion. tMl change in focus ~.sitale5 a revisiting of the public policy and
fisaJ implications of the proposed Stanford Research Park Strategic Plan to the City of
Palo Alto. The cballenge 10 the City of Palo Alto is how to mesh St4JIford U mversity' s
needs with our own SL'Ci> tMl both are beneficiaries of the anticipalcd economic and land
uae changea wirhin the Park ""er !he nexl decade.
FISCAL IMPACT
Fiscal impact of Stanford Strategic Plan on Palo Alto', economy can be signifiCMI.
However 1 it is pos..;ible to mitigate revenue reduction occurring due to tbe present tax
structure and economic shi fts,
No environrpental assessment is re.quireJ,
PREPARED BY: Caroi Jansen, Manager, Economic ReSOIJrCC5 Planning
CITY MANAGER APPROVAL: ~j\t\::tf;}\ll!!
BER.!"1ARD ],I. ~ ---
Assistant City Manager
Poa<.l" 13
,
~ ,
rl
I
I
-------:-------.:.---------------
City Manager's Report (In-Depth)
SUBJECT: PoIiq Implications of 1m. Stanford Research Park Sirategic Plan
--------------------
l\EL'QMMENDATlONS
Slaff rerom,nend! tlul the Policy and Services Committee evalUllle the public policy
options presented in thi5 report, .nil provido staff clear direction on future actions ilial
n<ed 10 be takor. with reg.ru 10 the prcpos«! Sta.nford Stral.:gic Plan.
BACKGROL'hl!
On April 5, 1994, the Pr',licy and Ser,'iu:) Committe.e. comidered th~ Stanford Research
Park Str3~gic Pl.ar. ar.d ccntinlJed th.e item for further staff revic,,, af'.d input from the
commtmity, induding: the Chamlx-r of Cemmerce and Stanford Research Park tenants.
'T1Y.: pre\,j~ n:pOr1 to the Polic), and Senilces Committee addresse.d th~ potentiai land
us<:, housing, a.."1d transpo1"tation is!;ues of the Strategic Plan, gi'ie:n traditional planning
.s.s.sumptians on t~ perceh"ed impacts of increased development within the Park. This
report i!lemplS 10 ana\)-~ further L~e public policy and fiscal implications of the proposed
Strategic PIL~ f<lf the City of Palo Alto .
.a~QO of the Stanford ReKNCD PaYk .s.trAtc~ic Plan
Approximately four yean ago, Stanford University embarked upon the preparation of.
Strategic Pan roc the Stanford Research Park, wit~ the then stated objective that the
·Plan-would Ix: available for public discussion jn one to two years. At that time,
Stanford MAnagement Company, the org&nization within the University responsible for
all COOlmI:lcial development, iDCl""ing the Research Part and Stanford Shopping Center,
was undergoing ,ub'tantill organizational changes that have subsequently affected the
f""'" of the Strategic Pan. As originall y envisioned, the Flan emphasized land use and
design issues rel~ to new park development or re-use; 85 currently presented, the Pian
focuses strongly en the Uni,,'enity's Slr'ateg)' toward renant nUx and future re-leasing
policies, IS opponunitics arise within the Parl<. In essence, the, University',
~ shifted !be foc"," of the strategic planning process from external
coosidentiom (land use, design and Irllffic issues) 10 interr.al c.onsiderntions -future ParI::
tenancy, r ... us (0 ongoing Stanford University research effans and national R&D
funding, and Stanford Resurcn Parl;/U;uvm,,)' infrastructure and support services needs.
CMlblS6"" Pq. 4 ollJ
,
\
[ ,
-",.
Equally important, Stanford implicitly ~::ogniz.ed tile potential value of the Park to the
University's iocome stJeam. not only .. a dired source of «ver.ue. but also as an indirect
source of revenue potenfully attnctive of fedenl funding fer n:search efforts in the high
IeclInoIogy .oreas of bio-scicooe. engineering. and oomputer sciences,
In staff'. opinion. that cha.~ge io focus ne=ita~ • ""'isiring of the public poticy and
fuca! irnpIiQlions of the proposed StAnford R=h Park. Strategic Plan te ~.,. City of
Palo Alto,
DISCUSSION
PQlics ImpljqtjO!JS gf the Proposed Stanford ReseArCh ParI;; Strn:~1ill
Stanford Research Pari: was founde<j in 1951 and hLoS ovoh·e<J 0"" the y<afS into 0""' of
the premier ~Mch parl:.s a.nd corporale h{"MqumC5 in the wor!d for high technology
indus.try ,
The Park has long r.-een an irnrXH1.an! K,t'rc.e of gerF~r4.1 f1Jr,j revenues [0 lite City"
Approximately 15 I:oefcerll (1f the Cfly cf Palo Altl)'s g('r . ."~rJ..1 fund rc\,{'nue; (Stant"ord
Research Parl. Stud)'. 1991) can be ::sttribute.d lo t.en.anl) wi'.hin !l-It Stanford Ri~::;.earch
Park. fn addition, tenants ..... ithin the Pad: are the single larg~sl cuSlOmer of the City'S
~lectric and water utilities, wh.ich has subSlin.tiaJ indirect re ... 'enue effects on Palo Alto's
genom fund.
Initially, SRP revenue sources to ta",ing jurisdictioru were l~g~l>' attributabie to prop;':rt)'
tU.es and the sp~n-off t-ffe.cts of I\igo.:r paid employment within the, .::-omm\ln.~t)'" As the
Park evolved and land values i ocrea.seJ. research and devdopmer.! ga vo way to
manufscturing operations and corporalc heMquar.ers, As manufacturing incr.:aseJ, so
did the importance of retail sak> to.x on good, ma.,ufactured "ithin the Park to the City'S
revenue stream.
Wilb the adoption of Proposition 13 in 1978. and soboo"!",,nl legislation and
administrative inIerpr<taIion of property tax a1localioo within the S~1e of California,
direct revenue. from the Park have cha.1ge<J O'o-er time, Property ~ have mainlained
steady bullnOOest increases, while aa1es tax on good' manufactured "ithin the Park have
declined over U-Le last five )'ears, due to loss of manufacturing in general in the region,
The la!tcr trend is expected to continue. and is corWslent with global ewnomic shifts
toward low-cost labor production markeL<, both i",ide and outside the United Slates.
The imposition of a utility user tax approximately five Yel''' ago has helpe<l to offset
losses from retail sales ta" on manufactlJred. gc>:)(l.'i; hawe-,:er, thal Wx ha:o historically
been allocated toward spxia1 projects, and is therefore not viewr:-.d as Ii readily available
hi< 50113
source of additional revenues, In additioa to the utility u>er tax, in 1992, the City
adopted a major increase in the real estate property transfer w for all property ~
within the City of Palo Alto, This increased rate re,o]ted in, sub,tantial one-time
revenue boosllo the City in 1993-1994, when four relatively new developments witltin
!he Park were sold, Parle leosney is very staDle, however, InC the likelihood of increased
property tax assessments due to change in ownership is. considered low,
In essence, the taxing structure intended. fOT Q; national prcduction en where • ww.geu·
were made and sold no longer filS the changing industry trends within S,lico" Volley and
the Stanford Research Park. Indeed, what we sell is knowledge, and in the absence of
a reversal of Proposition 13 or !he imposition of some form of "intellectual property w"
in lieu of retail saJes tax on manufactllred goods, Park reven"". C~ be expet-tcd to
continue to d""line. The Strategic Plan's stated goal toward attraction of n:search And
development finns with strong research ties :0 the Un.jv~rsjt)' is sound', and wiI11ikel)'
lead tD a continued heal.thy business. ~O\'ironment with~n t.he Park It m:::!.)' 1'10~, howe't'cr,
lead to a sounder fiscal envi;onmc-nt for the City. Th: chaJlenge. LO tht! City of Palo AI;o
is hew to mesh Stanford U niv,~rsity' s news Y'/lth our ()'f':'n, ,uch that bc-:h ar~ 'be roe fiej aries
of the anticipated economic .ar,j land use change;; ·"",'Ithin the Park ovt"r II:~ n::1;t decade.
The Stanford Research Strategic Plan has thee.: ~e~ iss"e, of impo" '0 tho C,(y of Palo
Alto, The)' are as follows:
1) The Plan advocates an aggressi .... o:: re·leasing policy with an emph.('ls.i.s. to-oJI'ard
research and deveiopm(:nt fIrms with ne:tus to the Univ.:rsity and Stanford Medical
Center, · .. ~his rnll)' result in an accelentlOn of change of use wit.'1in the Park..
Approximately 40 percent of .><isting P.,.~. tenants h.a YO Ie.. than 30 years
remaining on their lease term, and it is expected that re·lease negotiations wil\
begin for some of those tenants in the ncar future, As 000 Park tenanl remarU<l
at a ... .ant Stanford Research Park Forum meeting, even the deci';"" to replace
the roof on their facilities is partially dependent upon the University's strategy i.
re-lease negotiations wilh their compa~y, While the City of l'.!o Alto has no
involvement in Ihose negotiations, the changes in use that C3Il result may hAve
fiscal impacts 10 the City, Zoning and land use lire not an i<sue in lease
negotiations, as I .. "C City's wrung regulations pennit by right (i,e. are non·
discretionary) most forms of manufacturing, corporate offic.:; and rosearch anC
development within the Park.
2) 'The Strategic Pbn recognizes the need for more ,up"t"'n services within the
Research Park, a ... ·m partjcularly identifies the need for a major hotel and
conferencing facitity to serow'e Park tenants. Th~ lat~r issue was a.ddressed in the
• '_n __ ~_ ---..oIL.....,. ... , r s _____________ . __
•
· ____ ~"... ___ .. ____ ,~ ... o_ .. -.
3j
o
report to the Finance Committee, on the rerenfiy adopted Economic Re:lources
PlAn, where it WIlS estillUlted that • 300-350 room hOltI with conferencing facilities
at the Page Mill Road El Camino Real intersection could generate a minimum of
$750,000 in transient occupancy and sales ta,es to the City of Palo Alto, In
addition to providing a needed service. City support and faci!it.tion of. hotel and
C()Il/'erencing facility within the Park could do much to offset the antitipOlted
revenue decline fTOm other luing sources within the Parle.
Other support services, such as park-serving retsil and restaurant facWties, are
'allowable' under the City" conditional use pennit process. Stanford', leasing
policies have not been favorable toward retail in general within the Park confines,
however. Land values within the Park are high, and retail sale. and senice uses
generally operate on very marginal land costs, In addition, the fact th,t such uses
require dis.cretionary approval and count towa..-rd \he City's 'floor a.re.a. limiuticl'\S
on a per parcei basis work to discourage ancillary retaii and service uses within
the Park, An important public policy aspect of the SRP Stnltegic Plan ma)' be to
consider exempting specifiC retail and service uses frem t:'1e City's c.oilditional use
permit process, and more importantly, floor area ratio limitations, in order to
encourage their introduction within the Park. Such policy decisions. cOllld be
lJooersccred by the pcsithre environmental effc-cis of park',"K"rving retail and sen'i~
U,c;.es) which tcnd to reduce trip gen~r.ition by providing seT\"ices on-site for Park
.mployees,
The Stanford Research Park Strategic Plan strongly suggests the """d for tle<ibility
in negotiating with growth~oriented terumts. While ·fle:dbi1!ty" is not synonymous
with grealer building potential, the Univ.I>ity', need, .in negotiating with Nih
existing and new tenants strongly depends upon greater flexibility, The previous
report to the Policy and Services Committee from the City'S Planning Director
focused on the potential land use and transportation issues lniditionally identified
with "additional' Stanford Research Park development.
In the City of Palo Alto, increased development has been measured by building
size, with the explicit IlSsumption that larger buildings accommodated greater
numbers of employee, and therefore had more iniense traffic and housing impOlCts.
Such assumptions, however, are based on past experienc" with development
pOItterns, and may not b<' as applicable today or in the future to the Stanford
Research Park', changing bu,; .... environmenl. In addition, they do not take inlo
account rhe variable use, permitted within the Park by the City's zoning
regulations, Common trip geru:ration analy,.,., often use blended I1Ites for
corporate offi= or manufacturing, which have high employee to spae<: ratios,
with research a..r:-d development, that exhibit much lower employee to ~pace ratios.
10 fact, \his is ilIu.traled by the Genenoor project At the end of phase 1 in 1996,
CMR:4S654 P3ae-7 of 13
fe -
,
there ue •• peeled to be 289 employees occupying aOOut 128,000 square feet of
Sp&J:C, Le. olmos( 450 sq. ft./person finally, work habits are expected to change
dramatically over the ",,,t decade due to the explosion in tel=mm unication.!, with
resultant trip reduction, especially during non-peu hOlL ....
What !his means is that assumptions regarding futu.re SRP development may need
to be "re..,ngineered· into city regulatory and enab~ng tools that reflect anticipated
changes in glob&! and regional economic conditions, and that city policies
applicable to the Park in the future should be viewed with an eye toward the
anticipated taxing c~mate of tho City of Palo Alto, and more importantly, the State
of California.
!rnplieoti~'-.£.L~omprebensive Plan AdYi$~mmiuee CQnsid~.ratl~
~~,ford Researcb Park
The Comprehensive Pian Advi,ory Committee (CPAC) currently recommends Liat a 15
percent tloor area ratio incrc.1se be considered within th ... existing Park confines. As
pre-s<:nted, the CPAC propo'SJl IJKOip.vrates. other land use· policy isslles, such as
restrictions on future aeVeJllpment within (1~n space !cs.~rve areas owned by the
UrJvcrsity. In addition. afl ass.es~ment of the environmental impacts of the proposed
Comprehensive Phm is not yet tmdcfVllaYI nor have-the tools been formally identified to
ac<:omplish current CPAC goals a!Kl objective" In short, recommendations for increased
developmenl within the Park are cleM!, • long way from formal City Council adoption
as part of the City'S Comp"'Mosive PI"" update process,
Nonetheless, discussion of the CPAC proposal at this time is i.nstructive. While metJ'1ods
for implementing recommende<:! development increases within the Research Park have not
yel been defined by Ibe Comprehemive Plan Advisory Committee, City planning stafflw
indicated that the development approval process would involve a • community area
pl""';ng· effort, and discretionary approvals are envisioned to be applicable on a site by
$ito basi •. Given ~.,O' .. as.;umptions, there are three significant public policy implications
of CPAC's proposals, ar.d the possible effects of such policies on both Stanford
Urnversily ond the individual Research Park tenants vary substantially. They are IS
foil"",,;
1) While a 15 percent floor area ratio increase applied on a site by site basis within
the Research Park would pennit some flexibility to existing «nants, it would have
little physical effect on existing Park development patterns. Current City of Palo
Alto zoning regulations pennit a .4 FAR within the Park; a 15 percent increase
would allow for a .46 fioor area ratio development pattern, Visually, this
represents a change from typical two stol) development ... iill surface parking \0
a combination two and three story development pattern with surface parking. Its
,
\
---------.--~-..--.
useobility by iOOividuai !clWlts, however", may be govemod rna", DY the siting of
existiag structures and !he imposition of other City regulations such as limitAtions
oa impervious surfll<:es. In summary, ultimate build-oul of floor area ratio
incJuIe:! """lied OIl • site by site ba.s~. would probably not be realiud, whicb is
~ by the exress FAR available undere""ting zoning. Under current FAR
restrictions within !be Park, wmelt were applied in 1978, an additi(mal1.3 million
squon: feel would be pemritt.ed but has not been ~'·elop<d.
" relaIed Woe to be addressed is to whom the entitlements are given. Floor area
ratio inc:reue1 reponeD! additional square fOOlage. and that has added real estale
value. To whom should !hat ">lue be assigned if approved? Traditionally, in
oppIication of W>d use law, zooing ."utie meMs hoye been given 10 property
OWDen, not lessees. This ... u fundamental in L~ adoption of the City's downtown
regulations in 198-6, and the de\'~l0pmcr1i ir'~.enti't'e~ approved in conjunction wit.1,
the" downtowr. regtllations (rdIting 1.0 historic preservation, seismk upgrade, and
5pe-eial FAR "'''.emption'S) Yl-ere applieJ to propt:rt)' OWr};.!f"'S, eyerl thoug:' inciividual
tl'nan~ may have bt-cn a bexiid~' at the time of application,
Stanford Re:;ear(n Park, however, reprcscnts t! unique situ300n in o~nershipl
l,c~.Y'"~ reJdtk,mhip-:;. Base·.j on de.ed restrictions impcSl"....d by Lelrlilc! Stanford in
founding Stanford UrJ\'crsity in l SR5. PiOperiy ownership remains wHh the
University, regardless of the tenure of We le= or ille specific uS<: of the property.
Currentiy, 4{) percent of S~nford leases "ithin Ih< Research P&rk have 30 years
renu.ir.ir,g on existil1g lease5; new le.as-.e negotiation!. generalt)-' involve s period of
!l:t months to one ),c.a.r, ckreooing upc.n the u.se and circumstances unique to the
site .
"IT", logic of allocating additional de·,eioprnen' potential to Stanford Research P&rk
tenants, ralhe< than the Uni,·.,sity ')'s!em, lw merit. MA-'Y of the tenants within
!he !'ttl: are !be City', larxest employe", and all contribute 10 the richness of Palo
Alto's culllL'1ll and bu!ineso enviremnenr. In prac1ice, however, the useability of
additional developmen1 entitlements doc.I not resl with telWlts, generally, but with
Stanford University. OftentimeJ. change of use 0< • pending developmenl
approval process will trigger I"... negotiations with the University, and as
property owner !be latter has substantial control. This was most recently
evidenced in the negotiations bet",iccn Stanford University and Genencor
Corporation, an industrial enzyme research and deveJopmenl and manufacturing
operation ~ i 0 Rocbestl:r, New York. In thai case, the need for
substamial redevelopment of ~.", former Kodak site to accommodate Genencor,
coupled with th¢ change in use from film manufacturing and processing 10
industrial c:nZ)me fe-searcb, drove the O('gotiaticm prOCC3S, irrespective of tbe fact
""'., 0/ 13
2)
thaI Kodak Corporation was • holdi".g company for Gcnencor, and lhaJ 40 years
remained on the fonner Koda.k site leuc with Stanford University.
Stanford Research Parle corporate neat. may well differ from the n=;I, aM
desires of the Univenity actiog as c\e·'e\oper. Issue. itt'.port&nt to corpornions
include availability of employees, production aM administrative coots, p<oximity
to support services, and ...", of oper1l!iO!lS, te name a few. Only the latter,
however, i. directly nlattd '" \he City's IegislOliv. e",,\rornnenl. The City oi Palo
Alto', understanCing of and responsiveness 10 its business community i. of pea!
Ll'flportancc 10 Stanford R.esea.rcl\ Park teiUlnts. In p:a:rticular. attention to the City's
j:.'CI"1Uitting and development review proces..~.s may ha-'ie rubst.a..."'Itiv'C lmpact on Park
tenants' perceptioru of Cily policy. While the proposed Stonfonl Resear~h Park
Strategic Plan does no{ speal: to r.he~ issues directly, any .:-nangE-s il'l the City's
regulatory em-ironment affecting th-: Re-scarc11 Par},; should be csre fun;: con:.idereJ,
Re",'amping the City':) permit re\'ie',.I.' pT(x:e:s~ is (sS<:fllial f(, t.e-r;~nts, 3nd has tx~n
th~~ subject of much disrus~ior; amOTig mc-mD.cT<; of the CI~3.mtlo!r oi Commerce
Stanford P.e~lTch Park Forum.
ApplicatiClr of des-ign rt!bte-J Ji!>crt!liofl.l"I' rcvinl, ~:Iro .... ·cs.s.c~. <:;!Jch 8;5 community
area planning, ~p:=cific planning, planned lDlTH!iUnity wning, or "proactive
planning" in g:ncral within lh:: Rese.arch Pa.rk cl'uld ha ... ·e \'ery negative
con'JeqlJeoces. f01 Park. tenan.ts. R~gardless of hDW ',' • .:lJ intended sud, efforts may
be, mis·appBcation of land use planning &.nd design requir.:"lnen~ thai directly
affect corporate busir.es.s operations, can be ont'r('t!S. Permissible zoning ....-lthin the
Research Park has been quit<! open, :t.!"Id has. been gc~verned fa. more by landowner
desires than City regulations. Indeed, greater wrung t1exibility 10 facilitale retail
and ser.ice commercW uses with; 0 the I'1Irk may be awroPri:Ue. EqU&l1 Y scl f·
governing 10 use 1m been \he design rev;e"" pro«:" appIi~1e lo Stanford
Researcb Park. Until 1973, wheo the :::ity's ArclUtc..-rural Review Board was
established. design review ofvirrualJy all Stanford Research Parkdevdopmenl WAS
left to the discretion of the Univernty's pla,uung and architectu .... l offices.
NonetheJess, in tbe absence of any public desig~ review process, man)' City and
outside observers remark on the quality of the arclli!eciun: and the consisten-1' of
site planning exhibited within the Par •.
Imposition of additional dlscretionary review processes may be: seen as inconsistent
with recent City Council actions taken on Stanford Research Pork devel opment
issues. Over the last two 10 three years, the City Council has acted 10 minimize
City processes that directly .ffect induslrj, including ~~., within tht Research
Park. In 1991. the City's, hazardous: material) ~rmitt.ing ordinance was re .... is..xJ
to eliminate an unneces.sary pubiic hearing and d'uplicati"'e CEQA proc.css, &.nd
CMR:456.'94 hoe l' ollJ
· . ~ .'
~~
~ions to the City's Architectural Review Boan! reg\!lations were .pprovw in
1992 CO allow for gtUter scaffdiscrelion, particuli.rly in =mmadating handicap
ac=sibility 10 existing Park buildings. In summary, one cannoc ur.:lerswre more
the fundamenW policy issues rel.le<! 10 furore Park development (Of the City; not
only as il pertain, 10 our own City processes, but in L~e relationship of the City',
regulatory environment to other ageod .. , and the combined time ~ cost impact!
of all development approvals on business operntions,
3) Finally, important land use policy 4I',d fiscal issues for the City Council involve
the poICntial trade-offs of additional d.vel~nt entiOements wiiliin the Resean::h
Park, should they he comidered, aver the last decade or $V, poIine> leading I<>
new employment generation in the City wen: 'trnngly discooraged. A. the nature
of employment Vti.thin the Researc.h Park changes, !1oweyer. the tnditiona..l
environmental and traffic impacts associated with park development may also
change. Fliture Park drvelopment may not res-lIll in the negaliH~ impacts of
yesteryear; neitner, hOWeYI?T. they may result in de facto ir.-cre..ases. in the Cit)··s
general fund revenue stream. Al!ocation of additiun.aJ development entitlen1en.lCi,
therefore, should consider the u:.eability of and ber.eficiary of ti1Q,,¢ cntlt1e:ment.s,
an assessment of thd( villue, and potential fiscal IY.:n\!llt) to the Cit} arxJ oLhcr
taxing agencies it u:s;;:d.
PQUCY IMPLICATIONS
]n summary, staff suggests the Policy and Services Committee POS(' the ful10wing
questions to themselv.es and the City Counci.\ at large:
I) What, if any, message do City policy makers wilh to give Stanford University and
Stanford Research Park tenants regarding retention of existing Park =~? Might
those messages differ to the University and the corporate C<lmmunity, ~ if so
how?
2) How important is "flexibility" to !he University in mainlaining and promoting an
ecor.omically viabJe Research Pari< in !he future? How important is the Park's
economic health to the City of Palo Alto, and what are !he perceived pros and
cons of "flexibility?"
3) Does the City believe that additional development is necessary in order for
Stanford Research Park to remain competilh', in a world class research pari<
arena? Does "additional' development for the Park mean changes in use,
increases in allowable square footage, both, or neither'!
CMR:45Ii:94 Poe< 11 0113
, ..
t c' ~
!
I
I
I
,
,
i
.1
'I I :
I
i
I
.'-' --
4) If. change in land use entitlements are to be considered for the Research Park in
the future, what form might they Uke? To whem should they be allOCAted?
5) What direction does the City "ish 10 take regardir.g discretionary approval
processes for Park tenants; i.e. do we want to maintain status quo, or move toward.
greater or less discretionary review?
6) What trade-offs are important to the City in considering land 0.'" poli,,;es for the
Stanford Rese.u-ch Park and the community at large? If issues of traffic and other
en,ironmental considerations are rendered less salient over time due to a change
in economic climate, alternative commute patterns, lower employee ratios, or aU
or none of the above, are traditional land use considerations as importt.nl to the
City', review of Research Park development proposals as they once wore'? If not,
what other lrade-offs should be considered?
No action, or maintenance (If st.atus quo, may conlinue to lead to revenue declines. within
the Park Tncorpor:Hion of land use ch:mge$ ,'l,nd/or del{~lopment entitlements may help
to offset revenue losses in the h.lture_
meA!. IMPACT
Fiscal impact of the Stanford Strategic Plan on Palo Alto's economy can be significant.
Review of city policies may help to ensure a steady stream of income to the City as the
Stanford Research Park prospers.
ENYIRQ~¥ENTAL ASSESSMENT
No environmental assessment is required.
STEPS FOLWWING .APPROVAL
This report considers the implications of the proposed Stanford Strategic Plan and
=mmendations made by the Comprehensive Plan Advisory Committee that significantly
affect the City of Palo Alto's public policy and fiscal situation. Options available to the
City Council are discussed, and staff requests policy direction.
ATIACHMENTSjEXIllBlTS
NIA
CMR:45Ii:?4 Pa31: 12 or 13
,-'"'''""' --------------
/'
--------------"-......
cc: Slmford Univasity
Polo At", Chamber of COITlmetce
SIuford research ParIc forum
SaocIra Eakins, CluWperson, CI'AC
Will BcdeU, CIWIpe=n, CPAC
. -.::::------
o
"'II' JJ 01 JJ