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City of Palo Alto
City M~_~_~g~~:s Report
HONORABLE CITY COUNCIl_
FROM: CITY MANAGER DEPARTMENT: City Manager
CMR: 488,,,, AGENDA DATE, November 7, 1994
SUBJECT: Policy AlWmatives For Providing HGUSing Within
Palo Alto
8EQUt'ST
This report is infurmational, and is; intended to provide the City Counci! with background
iofonnatioll af1d alternative policy OptiDn<) regarding housing wilhin Palo Alto. Staff suggests
I ... ~at the c-IJnclusiofiS of thiil report be considered iiI conjunction \-liith the proposals of the
Comprehensive I'lao Advisory Committee on hOllsing policy,
POWey ALTERNATIVES
Council cohsJderation of alternatives iJenLifle-d below is requested in oroC-f to provide: staff
.,..+th housing policy input on the ongoJng Compre!"-.enslve Plan Update process.
1. Establishment of stond.!'d hou,ing zone(s) that allow for sub,tantial flexibility in site
planning, but with clear limits on density alld building mass. Sueh zoning should
limit the discretionary apprm'al processes to design issues, since use, density, and
building massing would t>e d.fined within the zoning regulations.
2. As part of the Comprehensive Plan update process, identification af appropriate
commercia1 zones~ and within them, the desirab:c location of housing in-lieu ('If or
in conjunction ~Nith commerciaL More succinctly, aU areas anticipated to be
developed ar redeveloped ,h ould be evaluated for their appropriateness far
commercial use, housing in lieu of commercial use, or mi:lted use. Where housing
is appropriate, the applicable underlying residenli aI rone should be incOJporoled.
Approval processes ,hould be defined for each type of development, and an required
discretionary review pr=s, particularly for housing only projects, should be
minimal,
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3. ExpionriQ!! of. development review process. as par1 of the joint City Manager/City
Attom:y's stud:I, fOf mixed use projeC\S within the City's commercial zones, As
with all boosing developments. th< in!-.erent public benefit "f the housing portion of
• mixed "-'" project should be recognized,
4, The City shookl support the Association of Say Area Governments' position on
pending legislation before the Stilte of California to alloute required fair·share
bow:irlg on the b.a.sis of regions or wb-regioru withil1 the San Francisco Bay Area.
~ Cit)' of Palo Alto's commitmerH !o its own hO"J.5ing 'Programs would not be
dimim.hed by Iny cllange in allocatioo process,
5. ~ Ciry $.houL:.l e~ore wilh the State of California's Office of Housing and
Commu.nity De't'clopf"n<ent (BCD) C:'1e acceptability of allowing an "incentive hued"'
housing prog:-rsm tn s.:iLisfy ;, portil)t1 of the City's housing requirements. Such a
prognm !,o;.C'..!id ifl~·l'!l-)\)rate the-rfmo\ af of e~is.ting regulations thai impeJe hCllSlrlg
devela;rmem, y,'hire (1tfirjr1g 3. pr<,-dictJb!;; appro\,<ll proCC'iS for beth the developer
a~ the citizenry.
6. E1:pk·l7..ij\"ln (If tr.c i:-g.ll an.;] p·olk:r" imp!JC2',tLOns., if any, of the us.e of commercial
irntvl;.'t fC("~ f\)r ",:yuI.;,ition of .::"t"Is.til~g !10u:;in!: stc;.:.;}; for USt a..~ low anti moderate
income boosing. E-x:pl0fe the fea.sibi!i!)' of State !egis.lation that allows low 3J1d
mOOcrxte lr.;;:.:-·me e:l"is!ing nnfaJ hClJ5ing scqu)sitlon programs to meet State of
California HeD requirements f{lf the 4 creal ion" of thi!lo t)"pt': of housing.
POLICY IMPLICATIili\5
'The boosing n...,-i.e: j, ,trong in Polo Alto •• nd tl,e iack of i.nd availability for new housing
will continue to re4nforcc '" ttroog markrl. The jobslhoosiog imbalance currently existing
in Palo Alto is likely to remain OV>:T time, barring signHicam land use ·.::hanges. or
empioymetll shifts. CurrerA :-egulalions in the City work against hoo,ing oonstruction. in
M no zoning exists to allow new housing development with any level of predictability to
die devcloper, Neighbomood cxpecutians are also not being met. as the densities
&DIicipaIod II the ootset of L'>e City'. housing programs .re considere<! unrealistic today.
Opportunities for lO'W and moderate irn:ome projects are particularly limited; therefore, all
options should be explored, incJuding pu.rchase of e::t:isdr.g "housing s.tock, to accommodate·
this housing oeed, The City's goals and objectives for housing are sound, but the tools we
.... 10 aclUeve !bern need 10 be re-examine<!, An in,entive based housing program that
allows hou..~g to be built, under reasofl.able densities, with known expectations for both the
<level"""" and !be neighborhoods, could resull in producing the housing slock desired in Palo
.A.ito.
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m;cuIlYE SlJ'MMARY
OYenU, the issue of howing venus commercial uS< has been a frequenf source of land use
controversy in Palo AH" over L'x: lasl two decades. The bilSe. for thi, controv=y lLrt
relatively straightforward .-the City of Palo AHa is largel)" developed; and the .,·ailability
ofland for any we, ",ilether for employment, housing or ~ail commercial, has botn scarce.
Competition for propeme. to redevelop, particulMty ior hiS her density housing or reaiJ
uses, las often been intense, depending upon ;he specific mvtrl and financing condition>
of tile time, The !""]lOSe of this report i, 10 offer ""'.!.sing policy ahernalive:! thai are markel
ba.-.ed, poIeDtiaIJy worbble 5<l!utiom 10 the City', housing needs; &I'ernoti"e:! thaI may also
rellect in put the intent of the CO<njI<'ehens.;"-e PI.n Advisor)" C ammittoe's ~rnendttions
for m= flexible and creoti". hoosing progams.
",rule th!$ repor1 was pr-cpa.'"'ed by lhe Erol1omic R¢so·mce'E P!.,\r.niilg pmgrsm, th~-Ptmoiflg
I)e.pa.'1ment has been inyohri!(j in ils rrepan:.!ion .,mJ has f~,,'~,-'w::d lk' (ln~ents of the re~)rt.
A comparoJor. discu$sicn of hC'l!sing is.si,..\:-s pn:rarcd b~ lr::.--D:r~':fcr of Planrnns: and.
Community Erlvironrnem is ('ontaiocd in t},::: C:,,·ur!.:d pa:::hl
flSCAL IMr.aa:
No direct fiscal imp"cl.
None required.
None.
PREPARED BY; Carol JP.nSen, Manager. &<lnomic Re>wn:es Planning
CITY MANAGER Al'PROVAL~~.0' _______ o:...~-;_'''-+ ____ _ BERNA~~OJNY
Assistant City Manager
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cc: CPAC
Planning Commission
Architectursl Review Board
Palo Alto Housing Corporation
Palo Alto Clwnber of Commerce
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City Manager's Report (In-Depth)
SUBJECT: Polley Alrernatives for Providing Housing within Palo Alto
REOIJEST
'This report is informational, and is intended to provide the Cit)' Couocii Wilh background
iniormotion and Alternative policy options regarding housing within Palo Alto. Staff suggests
that the conclusions of this r-!port be considered in conjunction with proposals of the
Comprehensive Plan AdYisQry Commiti~ on homing policy.
BACKGROUND
On October 11, 1994, the City Council approved a one-year implement.tion program for
the Economic Resources Plan (ERP). One of the four major areas identified to be targeted
withil!1 ERP ovet' the next year was to pursue the feasibility cf. and. if feasible, rezoning for
• major hotel with corJerencing facilities at the in!eJUCtion of P.ge Mill Road and Ei
CAmino Real in Palo Alto. III the October Hili report to the City Council on ERP
impIemenlation, staff identified the fin;t step in that process as the prepanltio" of a report
to City Council on policy alternatives regarding housing in Palo AlIO. While housing iss"e.
are IlOl directly related to • hOle! or any other commercial use, the present high densit),
housing designation on the Page MilllEl Camino sile ;s a major policy hurdle to eventual
hoIel development.
DISCllSSION
Overall, the issue of housing versus commercial use has been. • frequent source ofland use
rontroversy in Palo Alto over the last two decades. The base, for this rontrovers), are
relatively Slraightforward -the City of Palo Alto has been essentially built out during this
time period; and the availability of land for any use, whether for employment, housing or
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retail commer-i.al, has been scarce. Competition for sele<:ted properties to redevelop,
particularly C.".higher density housing or retail use" has often been intense, depending upon
"" specific market and financing conditions of the time, and the locational characteristics
oftbe »ICjkrty(.) involved. The purpose of this report is to offer housing policy alternative,
WI .", msrUt-ba.sed, potentially w'Jrkablc solutions to the City', housing needs;
al~ !hat may also rdl .. -t the intent of the Comprehensive Plan Advisory
C"",mittoe'. rewmmwdltians for an "incentive bas<d" housing progfllm.
An u1ld<nlADding of tl>e current housing debate requires a review of the underlying
~ of the City', housing programs of the last two deeades. Iii summary, they are
.. full"",,:
1. Urd a.,vtlapmenl in the Ci~j of Palo Alto, as with most other develo!"'..d
communitie-s wilh-in the state, prece.d~.d any State of California leglslative
fa1Uir~ments fJ'lr j0bslhou~ing balance wilhin the respective commuoltic!I. In
parti,:uj~, IN: d.eve!opment of the Stanford Research Park in the 1950's and 60's, and
the c.an~~omitant C"on.structirm. of major single f!i.mily home projects in south Palo Alto
cs.s,entiaHy determined existjng land lise patterns within the community fOT some time.
Tnere is lilLle v8.cant lil.nd (ivailable ill Palo Alto for any new US~, regardless; (If its
d::.s.inW1Hty. vlhat >J,.'lJl h:ar~fE in the. area ot new housing, retail, Of' even new
e-mploymeni \"i1l occur mostly eitht':T by inn1l development on small parc.els or via
natl1raUy ()(~curring T!!-development.
1, Housing policies established in the 1970's and 80'~ were in response to a combination
of foTCe'!i., Growth issues ill the Pr.ninslila ill general, and this commlJnity in
particular, were in the forefront of the puralic land. use debate, Wolle restrictions on
new commercial ond office construction were targeted, housing offered a viable
alternative lAnd use 10 retail .nd office. Additional housing also had the advantage
ofposifuteiy addn=ing the iGt>,!hou.ing imbalance issue in Palo Alto, • community
which bad produced substantial employment. Community sentiment was very much
in mar of housing, including the stated objective of providing low and mode",~
income boosing. Fin>lly, \he inflated housing values experiellceo thrOl.lShout the Bay
Area during tbe 1970's and early 1980's created a strong market for housing
development, especiaUy for high density condominiums, which provided a lower cost
hOUSing entry inlo • high ro;( market in P:UG Allo.
3. SiDce the 19691egislative imposition ofa state mandated Housing Element as par! of
• city" pl&ruring program, the State of California's Otlicc of Housing and community
ne-.. e1opmen! (HeD) has continually refined the requirements for providing our "fair
share-of housing within the cOlllmHJ1ity. Unlike southern California, where the
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jobsIbou.siDg balance issue is oddresse<l on • ,u<>-regional ba.sis, HCD requires that
each Bay Area ciry and """nry's fair share hawing allocation be set by jurisdictional
bouftdari<,s. A5. buih-<JUt cit.,., the opportunities fOf housing development within
Palo Alto are limiu.d. HCD's guidelines fo< the Housing Eiement essenti!lly requires
thai policies .nd progn.ms be adopted by the community that address the required
'm.. ohare' botWng issue, aN failuro to mtel those goah must be addrc.ssed. "The
S1aOe bas bee» p8rticu\arl~ diligenl in discouraging communities from adopting
policies .. -hlcl! are unrealistic or unanainable. Each community can set its own goals
aad objectives, 1>00.=, and HCD's u=smenl of the ade<JuacY of. city', housing
elcftIIcDI is oftetI. ~y ne;otiating proccs.5. The stale guideU"", actively prom~
silo by ule desipalioa fo< bowing within cammunilks, I1Id L'>e City of Palo Alia',
housing prognm hav-e relied 01"'" 'opport'Jnity' hoosing developm"nt (,udl a.s • .hose
CCI\!t1UC'ted on vacant ~ sites} or b.T· relO~jng commerc~a.1 propertit"-s.
rr sJ1.ocld be. O'Jte"G 1.h3~ v.t,ile eily h.,"lusing goals na', ~ ~e-n :uticul!l:ted to addrt".5s the
jobs\housing b.a..l.l!""'~ iHlJe, the SUl~ of t:~aiih)miJ'~ ~fi1.ir s!ure" a!loc.atiol1 pTcct'.SS
he little to di1 with Mdre~~ing J'0t.~,,1,hou~in£ t1,1Is'1.;.'¢ \!"'ithin ihe commuriit)'. Trle "fai!
shLre· !l..1I~tt.i.on pH':<t':~S h~5 tong t.e.:"iI COrL!.ro\::rs~zj) and there lS pen.::iiTlg state
l~gi:;11i!i ... "H1 \/ .. R 16~) 10 res'~l!"'~ hir .;.h,Ht n(',)sing alic-calio·rrs on d ~ub·region&j b':lSis.
The_ Assc<ia~iof\ of BOil' ,.\rt'-5 G1)\-Unm~,nts ~:'. in the P':)\.t';:=:,s. of forming a coalition
of lupport (li th:: building inJustf)', and various nO'Jsinb orgalljzatlons in support of
thi, kgi>l&tion.
4. Current bowing polioo. in Palo Alto <re pmlicated on the rollol'o,ng fundamental
approaches:
t. MaintJ.in existir.g housing in the Cit)'.
b. Net new housing unilS shoold be built in Polo Alto to addres.; the ccntinuing
job1lbousing balance iss"", and to encourage aIfordahility and variely in
housing type<.
c. Renlal botWng should be strongly eoc0urage<1.
d. Mcxiera:l.c incoJ"lle lJW~htp homing sh,xlld be incorporated into housing
pro~.e(,:u.
e. I..cw and modera", income housing in general ,hould be ,C\iye/y pursued in
the commu.nity.
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These approaches are influenced by cbanr.s in the legal, politic>!, financing, &nd overall
we. marl<.et environment for different hO'Jsing types. In the last two ~, the", !>ov,
been substantial ch~J1ges in the.sc &Teas that have impaclt:d the City's abifit)· to meet its
housing goo.ls. &me of these chmges art os follows:
i. 'The 1986 Federal Tax Law rev1sjoIU .substAntially curtaHed pril'!lte ~tor incentive
10 purchase or COnstnlct rental housing. 1n addition, the high 1&JWl "aloes in Palo
Alto are dramatically in <UJ'POf1 of ownership, venus ren!>I, howing construction.
Under these conditions, new rental hou...o:.ing cor.struction in the City rna)' be minhna.l,
and will probably occur under tht ausp~ctS of a nonprol~t hOluing orgafUL--..tiofl ather
than by private !eCt.or i niti ative.
ii. State Df CalifOffita. law permits up to ten ye.a.r> !o tiL-a su~l by a lil_1:n~o .... , r..:r or
association against t.he de\'-oloj:X!T (If 8 hnn~ing proj;.'';l for .al!·"gcd f::!uh)' ,-'onqnJ:..'lion
resulting in Qlatent" ddects {i.e, problem!' not ~'no\l,n until the:, {kY~:l)r (1\ {"I'" tjmc),
This time period, and what is g~nera)l)" comidc-rc-d k' t>c' ~n unf'".:-aJisti.;: pwducl
liability, is seen 8..'> e."(C-e·s S IV;:', b,' marlY huild...-rs in th ij"!~~i.Jqrs ~r,J ::i oCiGtlstiwtiai
dampener to condom\;\ium construction ;\1 gl!fltr2J thr":",Jghout th:: S~a\e.
iii. New housing construction, particularly higlier density ll1utti,n!e fa~il~', has been
cuntroversinl in Palo Alto o\·er the :yel!r5. 111(' a\'N~l(ln Ie' ITluliir!t" family housing
is exacerbated by the introduction of rental \'ersu.'\. o·,lo'rn:'~r.ip ~o'Using. :too proposed
housing projects can be partjcul~ly c-ontrovenial if "S}Xcifical:ly de-Si.gMteci 10j lo\\
and moderate inDJme housing. In s.hort. meeting man~ of the goals of the: City's
housing programs is politically sensitive. ar.d m~y continL!e to be difficul! in the
future unles.s ether approaches to hOU~lOg prOYtSlOn become a""&ila.h!e,
iv. The financing market for housing and commercial d-evelopmer.1 has varied 'l>Irid.ely
over the lasl iwo decades. The early 1970', hoosing boom in the Boy Aru was
essentially Slopped in ~~e late 1970', by rapidly escalating oMnclOg cos:.; buyers
were plentiful, b"\ they couldn't .fford the product. By the mid-I9W'., botll
c{)mmcrcial and residential financing was available; and the pressures for new
hOlJsing and commercial development were gre.at. In t~e aftermath of tM Sa ..... ings
and Loan l:risis) which resu.lted in a dry commercial financing. m:uket, re-side-ntial
financing was still widely available. In general, ler-ding institutions ha,,'c 001 been
comfortable with .mixed use project financing (Le, residenl.ia~ o\'er com~rcial). 8
fact which has tended to discourage projects of t..~at natlire. \l{hile r-e-sidcntia!
financing continues to be available, it is gcneraJly more favorable for the "safer"
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product lines. Condominium financing, for .xample, has suffered on and off over
the yem from a ·soft'" condominium sales environment, which has negatively
affe<:t<:d fund ayailability for condominium construction.
Potential homebuy.rs have consistently express«! their desires for single family or
.ingle family like produCl:i, at the same lime that neighbors to proposed projects haYe
expreosed 1he'.r displcaoun: with higher building massing. Coopled v';!h Iv&ilahle
financillg, these forces work 'tron81y toword lower density products, as exhibited by
the recently proposed Hyatt Cab.".. and Peninsula Times Tribune residential projects.
City of Palo Alto zoning regulations make housing development very difficult to
.chieve. Pressures to reduce the building mass of housing projects in the mid 1980's
led to the adoption of new multiple faml1y regUlations, and to changes in commercial
zoning that permitted housing in conjllncticn with re~lil. Floor area ratio (FAR)
limitations were imposed in the City'S mu.ltiple family zones thai ca'lTIot accomnlod"te
:he larger lowMomc product' that buyers prefer. At the time that Loc FAR's we",
imposed, the driving poHcy direction for more housing units workc,d toward mmng
buildings smaller but at higher densities, forces which lead to either "t"ry small units
or much lowered densities, The latter has clearly OCCUITe-..d, yet building mass is. slilI
~n by the community as an is.su('! to address in mUltiple familY housing proje-:ts in
Palo Alto. In addition to FAR changes, the cpportllrtities for housing in conjunction
with retail and service commercial were removed within Midtown and ChuIestcn
Shopping Center areas, thereby limiting housing opportunities in the City overall.
Finally, the sdditive floor area ",tillS and building setback, height, and parking
regulations intended to allow for mixed \JS-e projects within the City'S commercial
zone. simply did not work, !hereby discouraging mixed use proposals except under
the Planned Community zoning proce".
Z<>ning regulations governing process have also played an integnl role. in housing
issues before Palo Alto. Neighborhood input has been limited to the Architectural
Review Board process, one which rightfully looks at building design under ",e
existing zoning regulations. In the case of mixed use projects, use i~ al so an issue,
and one thai cannot be easily addressed by design alone. Even with all residential
project proposals, the dichotomy that .:<ists between expectations for de nsity (in onIer
10 """'t both City goals and State housing requirements and to recoup inflated land
values) and the palatability of building mass in multiple family projects to
surrounding neighborhoods is great. In tho absence of workable multiple family
zoning, the City has fallen back on Planned Community zoning to pr<>CeSS housing
projects.
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Tne pote-:ltial repercussions of reliance upon the PC process for housing or even
mi~ed use projects are <o""iderab!e, PC', establish use, design, .nd adequacy of
public benefit only by City Council action, This process pennits no essential up front
-b1Owns" to the deyeloper, such as how many units one can achieve, how large tht!y
can be, and what kind of ameruties are necessary to satisfy the public benefit
component of the project, Fundamentally, the required finding of "rublic benefit"
fer housing projects may well be in conflkt with the City's stated housing goals,
which imply that there is public benefit in providing hou,ing within the community
per sc.
vii. Land yalues for commercial Y~nus residential development fluctua~; and the City
of Palo Alto is presently in the position of seeing residential land values that
e.pproach, or are greater than, commercial property values. Traditionally.
commercial land values have generally outpaced residential properties. While. this
situation may not be unique to Palo Alto, there aie Soome key characteristics of this
community that could continue to reinforce the value of residcnti a1 versus commercial
properties, particularly within Lf.J.e City'S neighborhood and commercial sen.'ic~ ZOlles.
TIle prices paid for deve!opabl{', commercial land, particularl)' by big box: retailers,
are ~ub.s.tantially lower than values suppvrted hy office, reside-mii\!, or specialty
commercial u&e·:l. Thr scarcity .of Ilvailable land and an expressed communil)' ethic
for "hlJnie based" retail operations, particularly within the Ciiy's neighborhooO
commercial areas, have also played a rlJk in land vaJues, On the one hand.
commercial zoning regulations preclude some forms ofrctaiJ, wllile at tile ~ame time
the City's housing regulations and proces.'>es deter housing dcvdopm~nts that arc
easily marketable or well-received in tJ-le Cc.Hllmuliity. Undl.~r optimum regulatory,
TI.['I....lncing. and re,al estale market conditiom, one would expect to sec a variety of
housing propo>als on commercially zoned properties within the City,
POlley IMPLICATiONS
In spite of a number of conflicting forces, the City of Palo Alto has seen the construction
of over 1,500 new housing units, including 94 BMR units, since 1980, More striking,
however, is nol the numbei of Unlts C(1nstructed but the method by which they were
achieved, Preliminny research of pre."x; sri ng zoni ng on Palo Alto housing projects ind icate
a greater proportion of new net housing units wcre dcveloped by election of the property
owaer/developer, and not by City initiated rezoning of the property to residential. The most
commonly used mechartism for residential construction within the City's commercial zones
was Ille Planned Community zoning process, where findings of public benefit and a lengthy
di~tiolW)' review process is. required. What that means is that given the land situation in
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Pt.k> Alto, ... itil the City approac~lng buiId-<M and. growing scarcity of easily developable
land, many ocher factors L'Ulll z"rung may determine what goes onlO a site when it is
developed or ~oped. In particular, the market and ovailability of fin&ncing for a
.. opooed _ ""'y be the m.!jor determin.nl of what gets buill. Historically, these forces
hsYe cootjoued to foster noosing production even under \"ery difficult regulatory
<::irr1'dIUM 5.
n... boousi", martet is stroD£ in Polo ."-lto, ancllhe lack of land availability for new housing
will NWIIj ..... 10 rei~ • strong m.,ut, "The jobs(nowing imbalanc" currently existins
i. Palo Alto is !il<tly to remain avor time, barring significant land use changes or
empIo) __ dUfu. C=m regu!stions in the City work "gainst housing construction, in
that DO zoni"8 exi.u 10 allow ""w housing devel"!,,,,,,nt with .ny 10,'01 of prediCUlbility to
tbo developer. NeighOOrhood expectations are also nm being met, as \he densities
LTlricipit::d .1 the ot.:tsct of the City's hOI!sing program:) are cO,1sidered unrealistic today_
OpporvJni~ for low and moderate income projecl5 are particularly limited; therefore, aJl
opcion:s. s.hoold tx-explored, including 9un.:hase (If ¢xi~ti.ng housing stock, to .accommodate
this hwslng n:eo.i. Om ,goals and noj<=,,,tiHs flIT housing are sOI:nu, but the tools we use to
ac."Ucye them n.ecd to i>e rewor\;.oo An ""incelitlvc based· housing progr"lTn that aHllws
nou.'I.ing lo be buill, linda rC.i<:'0n:bl..". J"·[lsitie:>, ..... ··;lh knov/11 expectat.ions for beth the
Ge\'!tOJ)'.;;r L'ld ti"IC nejg~lboj"hood$, (ould go far in minimizing the controversy ever housing
in Palo Alto.
CocnciJ cons.ideration of alternatives identified below is requested in order to provide staff
with housing policy input on ~ ongoing Comprehensive Plan Update process.
I. Eslablishmeru of.tandacd housing zo",,(.) that allow for substantial flexibility in site
pl''''';.'. but with clear limits on den,ity and huilding mass. Zoning should
i!>corponIe &Il expand<d building envelope but. limited floor area ratio to allow the
gteIIicsI CT<ativi!)' in lite planning wi thOU! producing undesirable bcilding mas.. In
a6<titio<>, building fom,. "'oolil be articulloted for the general public in commonly
Iued lmguago, so that techruc& lools translate into understandable fonns such as
.ingk story, or., and two >!ory. semi·depressed or tuck under parking, etc. Finally,
such wiling should lirr>it 1M discretionary approval processes for housing only
projects to design issue., since ose, density, and building massing would be defined
wnml\ tbo toning regulations.
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4,
5.
As part of the Compreh<",iv< Plan update proce>s. i(\enlification of appropriate
commercial zones, m:f within them, the appropriate lOCAtion of housing in-lieu of or
in conjunction \\>'ith commerciaL More succinctly, all ar-vti anticipated 10 be
developed or redeveloped should be e'oillil.ted for their appropriatel1e5S for
commcrcW use, hausi~ in· lieu of commen:iaJ use, or mIxed use. Where housing
i. ~te, the appiicabk uoderl)ing resid<:ntial zon< should be i1lCOrporatc:<i.
Approval proces.se$ .nooi~ be defioed for each type of d<\'elopm<or.I. and all required
discrnionary ,...,-iew processes. partiC"iariy for housing only projects, should be
minimal. Thex can be e:q>lored as part of Ill< join, City Mana;:eriCity Attorney's
developmenl review $!Udy. 'The 8"'.t'er the rommercW IIU.> de$ignatt<l for
uoderlying bousi"ll demi!},. the gte.'lCr the opportunities for iocre.a<cd housing in thc
City. Such zorjng can be-KCompE:ihed with the iJ5e of staJ1d.ard wning loo]s, such
as rrtixed use zoning, 'IAoith defined pnxesv-5 UTklei different i,J$~ sc.ertarios.
Exploration of a de\'elo~menr n.':V'Et\y prL)':t"5~. as r.art ~)f th .. ' .toini Cit)" M?,na!?:eriCity
Attornc~ .. ·s s~l.od)', for mi~~..J U"': proj~.::b \I., i[hirl lh~ Cily' <; (,.'m~c"rd,::I.llGrlcs. On or:t
hand, the buJdir.~ fTl2.o;sir,,?,, p~rk;i';g. 3.1'1''-) ~f\"ji',-j ili.""Jl'" 3.~)~u~ (1.1 mixed us..e pro,ieclS.
go beyond the iradil!OT':lj design i~~'Jt'~, i';.~:J, !h~rl'f()n:, s'h,:-'!)!d tx-subj:!'cl 10 a public
[e\,'I~w prtxe5.s tlifl.t il.ll0,\ S i!'VJI lei, :11\ :l:--~".: ... T~ tlf 1.h-.: pro;,;"·;,. Un the-ether hand. if
the City wis,hc:'S !J e~courag~ r:1i~c'"J U~ p'\',.j;!":iS.. In ,ardu,,)u<, r'JD:ic [t'.-Le· ... · pr(X'~s.s.
such as L,at required und:!f the: pLmnt·J c,)mrm'lliiY Z,)~. woul<3 be inadvisable. A
combination of l()C..ation.aJ .::ritena, lGillng r,'.~ulalion:) thai \l,Nk toward ar.:hieving .
rni.te-d use projel't.s. and 4lI'l "pproprial:: de\dupmenl rt"vie· ... ' procl,.'s5 is. oc,essary to
fllcilit2.re. mixed use prcte::t3\ pat11clilsrly in light (If a nc\-t00·fa\'orable financing
market. As with ali housing dt\elopmenL~. the ir.ht'rtnt publi.: h('nefil of tnt! housing
portion of a mix«i US<. projl;"\,;t s-hol.jld bt rc(ognil.ed.
TIle City should support the Assocl.p.Lion of B-ay Area Governments' posItion on
pending legislation before the Slate of California !O allocate required fair-sbare
housing on the basis of region.s or sub-regions...., itni!"! the San Francisc'() Bay Ares..
Housing aaocations based on artificial Juri:.dictionai boundarie-s limit flu.ibility arad
·common -sense'" bod use planning, particular!y in an area ~uch as the Mid-Peni~.slJla,
where many small, mostly de .. ·doped commllflitJes exist. The City of Palo AHo's
commilment to its own housing programs 'oI.'-'"Uld not be diminished by any change in
allocation pro.::e55,; howev-er. the fle"ibiE\y cf each comm~lnity in meetir.g 'its housing
goals might be better S(:n'ed with a regionally based fair-... han: alioc.Jllion process.
The City should explore wilh til< Stale of California om", of Housing and
Communit), Development the a':CI;!:ptability or all o ..... ing an "incentive b~" housing
program 10 satisfy a portion of the City's h.ousing rcqu;r~ments:, Such a program
CMR:4I8;94 .... <I! of B
L
'\
would incorporate the removal of <Xlsbng regulations that impede 110usinz
development, while defining a predictsble opproval process for both the devcloper
and !be citizenry. Finally, an 'incentive base<l' housing program would .... orlr. with
!be favorable li1U!JtCing and real estate sal", market for housing in Palo Alto. A
comprehensive new housing package incorporating market incenti,,'es, revised zoning
regulations, and development review procesS('s could substantially augment the
tradUional site..!Jy-site housing desizPllion process currently utilized 10 mee1 StItt
fait-share housing ""!Virement!.
6. Expioratio!! of !be lepl and pollcy implications. if any, of the US(' of comme<ci&l
impact fees for acquisition of existing hOlJsing stock for use as low aad rr..cdeTak
income housing. Explore the feasibility of State legislation chal allows low and
mode·rate inc.ome exi3.ting rental housing acquisition programs to meet Stale of
CaHforn1s HCD requirements for the ·creation" of this ty~ of hous.ing. \\~jle c<.,sts
and neighborhood controversy are minimized. with the. p"\JP::-haS-t' of c:tisrirsg housing
stock, the use of City required hQusing imp:ict fees {fiT n,;:w hous-in,!; projeds :mpli~'5-
that srlditional housing will be provided. None th<! le!.s, /:lo!h the higl1 1.:0'.01 of f\:eiolro'
constnlction and the controvenial nature of ]O\\, aJld l!IodC",d.~ in,:::ome he'J'SH'!:
ptf.ljtcts :-ilJggcsl that flexroiHty 1n muting the pn\?,i<l1l1'S L-t-,ji.'cti,·cs may be
advantageous.
DSCAI. IMPACT
No direct fiscal impacts.
ENVIRONMENTAL ASSESSMENT
None required.
ATIACHMENTStEXIII!!!TS
None.
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