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By Douglas Moran

RPP + ADUs: Winners and losers

Uploaded: Mar 4, 2017

One of the classic mistakes in politics is to become overly focused on the details of official actions at the expense of asking whether those actions support the purported goals and strategies and which interest groups are served, and which aren't.

There are three important items on the agendas for the Council meetings of Monday 3/6 and Tuesday 3/7. Groundwater pumping was discussed in my previous blog. The other two are the downtown RPP--Residential Preferred Parking Permit Program, with two of the P's being silent--and ADUs--Accessory Dwelling Units, aka "Granny Units"--which I will address here.(foot#1)

Note: I don't live within the Downtown RPP--or any other RPP or anticipated RPP. Page 10 (PDF) of Friday's Palo Alto Weekly has an ad on this issue from leaders of the neighborhoods within the RPP.

----Downtown RPP----

There are three basic goals of the RPP. First, reduce the significant negative impact on quality of life inflicted on those neighborhoods by overflow parking from the business district. Second, promote vehicle trip reduction for commuters--if they don't have a place, they will have to find other means. Third, provide appropriate preferences and exemptions to various categories of non-residents, especially resident-oriented businesses--ranging from medical facilities to residential facilities such as Channing House--and employees for whom the alternatives are too difficult, either logistically or financially. The strategy revolves around incrementally reducing the number of permits available, by 20% per year, to give business and people a chance to adapt.

There are three significant interest groups that are roughly: the residents, the resident-serving business (employees, employers, customers), business that are office, R&D... (employees, employer, landlord, developers).

The biggest problem with the Staff recommendation is that it negates the strategy--thereby subverting the first two goals--and does too little on the third goal. When the Downtown RPP was initiated, the estimate was that 2000 employee permits would be needed, however, the maximum number of such permits currently only 1335 (with the maximum having been 1515).(foot#2)(foot#3) The Staff recommendation is to reduce the permit count from the original (faulty) estimate rather than from observed need. Thus, it will take over 3 years before the number of permits being made available to employees comes down to the current level--that postpones any pain or gain until after the next Council election. The winners are the third interest group--office workers, employers, landlords--and the losers are the first interest group--the residents.(foot#4)

----ADUs----

The "goal" of this agenda item is to increase the number of ADUs, but this isn't a proper goal because it isn't based on an adequate notion of what why this is good. Without that foundation, you can't have a real strategy, both to achieve positive results and avoid negative ones.

When I have listened to the rationalization for ADUs, the lack of thought in many is troubling. For example, at least one person has testified that they want an ADU for their parents when they come to visit because hotels are so expensive. But construction costs alone for an ADU would be $300-350 per sqft, so a 500 sqft ADU would be $150-175K plus fees, taxes, maintenance ... That is a lot of nights in a hotel. Similarly for the official (Greg Tanaka, now Councilmember, then on the Planning Commission) who suggested that parking impacts for ADUs could be handle by putting it underground (garage or lifts). Basements are very expensive--even without groundwater issues--and if your goal is creating affordable small housing units, this seems to be a non-starter.

There is the claim that ADUs would provide housing for lower-income people, but this often comes from the same people who are arguing that young professionals are seeking smaller units, and sometimes explicitly include ADUs in this. So how are those lower-income people going to compete?

Some have advocated for their having an ADU to help pay for their mortgage, not thinking about the ripple effect on housing prices: The ability to add an ADU, not just have an existing one, could increase housing prices generally. I haven't seen this concern addressed.

Then there is the claim that providing ADUs would decrease competition for other types of housing to the extent that it would result in decreases in housing prices for everyone. I find it troubling that so many take such claims seriously, and don't even ask for a back of the envelope calculation.

Then there are the messy details related to parking. First, State law exempts ADUs near transit from providing parking on the erroneous theory that those residents won't have cars ("In theory there is no difference between theory and practice; in practice there is").(foot#5) More generally, many ADU advocates want to exempt them from parking requirements on a similar theory of them being "car-lite". However, this seems to be entirely aspirational ("Hope is not a strategy"), without any sense of there is a practical and legal means to achieve that.

Then there is the Airbnb problem, and it is a potential big one. San Francisco and other cities have experienced worsening of affordable housing shortages as units, even buildings, have been converted, often illegally, to Airbnb. And transients, including professionals, bring problems to residential neighborhoods. Recent counts of Airbnb listings in Palo Alto were over 1,200 and growing, but only the totals have been provided--no breakdowns or other analyses.(foot#6)

During the campaign, now-Councilmember Adrian Fine advocating going to Airbnb headquarters (in San Francisco) and working with them to come up with fair regulations. This seems rather naive, given how vigorously they fought LA, New York City, San Francisco and others. The LA and NYC analyses found 60-80% of the listings to be illegal (violation of local ordinances on renting) and that provided them with leverage to eventually get some concessions from Airbnb--I speculate that they became worried that their business model could be characterized as having criminal facilitation as a major component (ethically, if not legally). History suggests that City Hall is unlikely to ever develop, much less deploy, such leverage: That history too often finds City Hall working to find arguments and interpretations that favor big-money interests over the residents.

So who are going to be the winners and losers in this? Hard to be specific. But when you have a program that hasn't thought through how to minimize counterproductive actions and outright abuses, you should expect lots of losers.

----Footnotes----
1. Agenda, March 6
Agenda, March 7
These agendas contain links to the Staff reports.
If you want to send comments to City Council, the email address is "City.Council@CityofPaloAlto.org" (capitalization is optional, that is, irrelevant). You are requested to identify the meeting date and agenda item number of the subject line to help organize the emails so that they can be read more effectively.
The RPP is item #10 at the 3/6 meeting; ADU is item #2 at the 3/7 meeting.

2. "Table 1: Recommended Reduction in Employee Parking Permits by Zone", page 5 in the Staff report.

3. There is only speculation about the causes of difference between the estimated number of employee permits needed and the number purchased. Some people parking in the neighborhoods were not eligible to buy permits, such as Stanford employees and outbound Caltrain commuters. Some shifted to parking in Menlo Park neighborhoods just across the bike/pedestrian bridges. But there aren't even rough estimates for these, and other, categories.

4. The argument that employees have a right to park in neighborhoods seems to be contradicted by a US Supreme Court decision cited by one of the supporters of the RPP who is also a lawyer: "To reduce air pollution and other environmental effects of automobile commuting, a community reasonably may restrict on-street parking available to commuters, thus encouraging reliance on car pools and mass transit. The same goal is served by assuring convenient parking to residents who leave their cars at home during the day. A community may also decide that restrictions on the flow of outside traffic into particular residential areas would enhance the quality of life there by reducing noise, traffic hazards, and litter." - US Supreme Court in ARLINGTON COUNTY BOARD v. RICHARDS, (1977) No. 76-1418.

5. You can easily have residents who don't use cars to get to work, but need them for otherwise, and consequently their cars are parked in the high-demand area near transit during the day. I know of actual examples of this in the Cal Ave area: The residents take the Marguerite Shuttle to work at Stanford.

6. One instance: "Neighbors resolve conflict over potential Airbnb rental: Crescent Park home was to be rented to up to 14 people, but owner has reconsidered", PA Online, 2016-10-07.


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