http://paloaltoonline.com/print/story/print/2008/09/26/where-8212-and-who-will-pay-8212-top-stanford-housing-questions


Palo Alto Weekly

News - September 26, 2008

'Where' — and 'who will pay' — top Stanford housing questions

City, Stanford to talk housing for expansion, much of it likely low-income

by Arden Pennell

So far, no one has disputed a study showing the proposed expansion of Stanford University's Medical Center and Shopping Center would bring 3,200 new jobs to Palo Alto. Nor that those employees would fill nearly 1,900 households, according to the city-commissioned report by Keyser Marston Associates.

But who should provide and pay for the housing — much of it low-income — and where and for whom, is up for debate next week.

The city's Planning and Transportation Commission is scheduled to meet with Stanford representatives in a study session on the housing report Wednesday. The meeting is scheduled for 6 p.m. in the Council Chambers at City Hall at 250 Hamilton Ave.

The city wants Stanford to provide housing in Palo Alto, particularly below-market-rate units, according to Steve Emslie, the city's interim deputy city manager.

Emslie said Palo Alto already has a housing-jobs imbalance, with twice as many workers as homes for them. Living near a place of work is eco-friendly, he added, allowing employees to get to work on bike or foot or at least reducing the length of car trips.

Impact fees are already levied on new buildings in Palo Alto, then put into a fund for construction of future affordable housing. Ideally, Stanford would actually build the housing, the cost of which isn't fully reimbursed by fees, Emslie said.

The city is currently creating a housing proposal to bring to Stanford at some point in the future, he said.

Yet the medical center isn't responsible for building new housing as part of its hospitals' expansion, according to Shelley Hebert, Stanford's public-affairs executive director. Nor is it responsible for paying impact fees, she added.

Under Palo Alto ordinance, hospitals are exempt from the fees because they are assumed to already provide a public benefit, Herbert noted. The City Council upheld that ordinance once more in March, against a challenge stemming from concern over Stanford's expansion.

Hebert added, however, that the portion of the expansion that would house community clinics — not hospitals — would be subject to impact fees. That amounts to roughly 23 percent.

The Simon Property Group, which operates the Stanford Shopping Center, did not return calls for comment.

Both sides of the housing-and-fees issue may be examined at the coming meeting, Fineberg said.

"There are structural conflicts. The hospital wants to reduce its costs, and it's their responsibility as a prudent nonprofit to push for that. [But] community members don't want the burden of having to provide housing through hidden [costs] in other places," she said.

If Stanford doesn't pay development fees, the cost is passed on to private developers who in turn charge residents more for new houses, said Fineberg, who noted she wasn't stating her opinions but issues that might be raised next week.

The Shopping Center as a commercial development will be subject to impact fees, Emslie said.

At between $12 and $15 per square foot, that's at least $4.3 million toward affordable housing from the Shopping Center's 360,000-square foot expansion.

And that money for low-income housing may be needed, according to figures the study provides.

At least 70 percent of the 555 households that the bigger mall, new luxury hotel and restaurant would generate would be for very-low-income residents, defined as less than half the area median income. That's under $53,000 for a four-person household, the report states.

In contrast, the Medical Center would create a need for mainly upper-income housing. Of its 1,301 households, 64 percent would earn more than 100 percent the median income, according to the study.

In total, the 1.6 million-square-foot expansion would generate a need for 1,856 households, the report states.

Exactly which type of households should receive homes is also up for discussion, Fineberg said. The focus could be on lower-paid retail or service jobs in the mall, or it could be for slightly higher-paid support staff at the hospital, she said, noting that neither group could likely afford pricey local homes.

"A [medical] resident can't afford a $2 million north Palo Alto house, either," she said.

To help shape her perspective on housing, Fineberg said it will be important to find out from Stanford precisely how many workers commute from far out in the East Bay — and how many live nearby.

Hebert said only 9 percent of hospital employees currently live in Palo Alto, meaning it would be a mistake to assume the majority of future employees would want or need to live strictly in city limits.

Finally, even if built in Palo Alto, exactly where housing should go is also up for discussion, Fineberg said. If erected between the medical center and downtown Palo Alto, high-density housing could disrupt the city's long-term goal of connecting the new, larger medical and shopping center areas with downtown, she said. The two areas could form a pedestrian zone if connected, much like the "urban village" feel the city is already shooting for within the expansions themselves, Fineberg said.

The housing study is available online at cityofpaloalto.org by searching on the term "Stanford housing needs analysis."

The amount or type of housing, if any, Stanford needs to provide will be finalized in a development agreement expected to be signed later in the expansion. The state-mandated environmental review for new construction will also address housing.

Staff Writer Arden Pennell can be e-mailed at apennell@paweekly.com.

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