Downtown Commercial Cap: Once more into the breach | A Pragmatist's Take | Douglas Moran | Palo Alto Online |

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By Douglas Moran

Downtown Commercial Cap: Once more into the breach

Uploaded: Feb 10, 2019

Remember when City Council was opposing the conversion of the President Hotel building from affordable housing to a hotel? Seems like just yesterday, but it was actually weeks ago. At Monday's Council meeting, they will once again be voting to "grease the skids" for this conversion: by making a major change to development policy. The President Hotel is only the immediate impetus for this change: It can create large problems for years to come.

The proposal this time is to repeal the Downtown Commercial Cap -- officially the "Non-Residential Square Footage Cap". The Cap was designed to trigger a comprehensive re-evaluation of the Downtown area, updating policies and limits. It provided for up to a 1-year moratorium should that be needed. We are either close to, or over, that cap depending upon ambiguities about what to count.

Why aren't such studies already underway? Because in early 2017, the pro-development Council majority directed Staff to produce a repeal of the Cap. This was a Council majority where major policy changes would pop up during Council meetings, not giving Staff or the public time to review, much less comment on, the changes. At least one of these was introduced as an amendment after after the public comment period had closed. These major decisions were made with little discussion, indicating that the Council majority had deliberated behind closed doors in violation of the Brown Act or that they were grossly derelict in their duty to have such discussions. Three members of that former majority are still on the current seven member Council.

One of the tricks in negating data that will be against your agenda is to schedule the decision to be before the data can be collected. Another trick is to broaden the data collection so that the problematic areas disappear into the averages. We see similar tactics here. That Council majority tried to replace the Downtown Commercial Cap with a cumulative one for Downtown plus California Ave and El Camino. That cap is 50K sqft per year, with unused portions rolling forward. It is conceivable that most or all of that could go into Downtown projects in a single year. The current Downtown Cap is 350K sqft, so 50K growth is 14% more in one year than what is already there. How does that 50K sqft compare to historical rates? In the 5 years of 2011-2015, an average of 27K sqft was added (134,400 total), for an average annual growth of 8% of the Cap. In the past 3 years, the average is 13K, or 4% of the Cap. In earlier years, it was far less.

And who is calling for this change? "Pro-development" forces, the ones who argue that building more housing should be Palo Alto's top priority and we should incentivize/subsidize developers by allowing more commercial construction, even when that commercial construction makes the jobs-housing balance even worse.(foot#1) However, when our housing needs interfere with a developer's desires, suddenly the housing priority isn't.

A big unanswered question is how the elimination of the Downtown Commercial Cap would interact with City policies supposedly intended to increase housing in Downtown. Currently commercial space has higher value than housing -- potentially enough to offset the incentives for housing.


For a deeper discussion of the details, I recommend "^Council to revisit Downtown Commercial Cap^" in the 2019-02-08 issue of ^Palo Alto Matters^.
The 91-page Staff report is "^Downtown Cap: Repeal of PAMC Chapter 18.18.040^".

You can send an email to City Council. If you don't use the preceding link, send it to [email protected] and include a Subject line such as "Feb 11, Agenda #10: Downtown Commercial Cap" to help Council members spot it among the many messages they receive.

1. Making the jobs-housing balance worse:
Facebook's proposed Willow Village campus in Menlo Park is an example of a project promoted as addressing the jobs-housing imbalance.It will have 1500 housing units, a hotel and 1,750,000 sqft of office space,which at a generous 200 sqft per employee translates into 8750 office workers,which in turn is 5.8 office workers per housing unit.
More info: "^Facebook submits revised plans for Willow Village^", The Almanac, 2019-02-08.

An ^abbreviated index by topic and chronologically^ is available.

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