City of Palo Alto to capture business info

New online registry aims to help city obtain job numbers, commute information

Facing a job boom of immense but mysterious proportions, Palo Alto officials voted late Tuesday to create an online registry that will require all local companies to provide data about their employees to the city.

The business registry, which the City Council voted 7-0 to support (with Vice Mayor Liz Kniss and Councilman Greg Scharff absent), aims to fill an information gap that has hampered the city's effort to address its growing traffic and parking problems. Though various estimates indicate that the city's population doubles or triples during the work hours, no one knows exactly how many employees commute to Palo Alto every day. The lack of reliable data has become particularly problematic in the last few years, as downtown's parking shortages hit critical levels and emerged as the council's leading concern.

On Tuesday, the council agreed that finding solutions would be tough without more data about the city's workforce. The idea for an online registry came out of a February memo from council members Marc Berman, Pat Burt, Karen Holman and Larry Klein, who noted that Palo Alto is "one of a few cities in the region without a business registry or a business license."

"Most cities rely on these tools for obtaining and analyzing critical information about the characteristics of businesses in their communities for purposes such as informing zoning decisions and public-safety planning and service response," the memo stated.

The new registry would differ significantly from the city's last effort to collect data about employees. In 2009, with tax revenues plummeting, the city tried to institute a business-license tax based on companies' gross tax receipts. Though that proposal was designed to raise revenues, data collection was a welcome bonus for officials eager to fill the information gap. Voters ultimately killed the proposal on Election Day.

This time, it's not money that the city is after, but rather information, especially as employers buy parking permits from the city for parking structures downtown.

"Parking spots are the currency on the streets now," Mayor Nancy Shepherd said. "We're trying to get a handle on this."

Annual fees for the new registry will be in the ballpark of $35 to $75 and structured only to recover the costs of administering the program, according to a report from Economic Development Manager Thomas Fehrenbach. On Tuesday, some council members indicated that they'd like to see different fees for companies of different sizes (with the idea that it takes more resources to enforce the rules with larger companies than smaller ones), though everyone agreed that fees should not exceed what it would take to pay for the online registry.

Fehrenbach said that while the main aegis of the registry is around transportation and land-use planning, it can also have implications for other city services like economic-development planning, public safety and emergency preparedness.

At the very least, it would strengthen a system that has been broken for years, council members agreed. Currently, companies setting up businesses in Palo Alto are required to obtain a one-time "certificate of use," which includes a fee of $413. Many don't bother to do even that, according to Fehrenbach's report. Those businesses that comply are not required through any city mechanism to provide updates about employee figures or even their status of existence. The city also has no procedures in place for filtering out certificates of companies that no longer operate in Palo Alto. As Councilman Pat Burt observed, the city's paper-based filing system would suggest that Google and Facebook are still local companies.

Staff had initially proposed using the current system as the backbone for the new registry. But on Tuesday, after discussing the many problems in the existing structure, the council backed away from this plan, directing staff to proceed with outreach to businesses on developing the new registry. On a separate track, staff will work to improve and automate its "certificate of use" system for future integration with the new business registry.

Though the registry idea hasn't seen anywhere near the opposition that the tax proposal generated in 2009, a few speakers at Tuesday's public hearing expressed concerns about the latest iteration. Attorney David Lanferman linked the new proposal to the failed effort in 2009 and said he was concerned about the registry ultimately turning into a tax.

"This has a strong similarity to something the voters turned down," Lanferman said. "Their wishes should be respected before we do a run around that."

Hal Mickelson, a board member at the local Chamber of Commerce, offered a small list of concerns that the business organization has about the new registry.

"Our central position has been that the business community is not calling for a business registry. There is no need for it within the business community," Mickelson said. "But if it's deemed necessary for effective city administration, we believe it should be revenue neutral, limited to cost recovery, as simple as possible, further simplified for small businesses and that home businesses should be exempt."

He also asked the city to respect the confidentiality of high-tech companies with proprietary information. He voiced concern about some of the questions on the city's proposed questionnaire for businesses, including ones relating to county health permits and tobacco sales. Mickelson said it looks dangerously like council members are "putting ornaments on a Christmas tree" with the questionnaire and urged members to avoid adding "avenues of wonderfulness" to the proposed registry.

Klein challenged the idea that this registry could somehow turn into a tax, noting that state law requires a vote of the people for a new tax. Klein also encouraged Mickelson to talk to other Chamber organizations to see how they dealt with the issues he laid out. During the 2009 campaign for a business tax, Klein said, many in the Chamber said they opposed the proposal but would support a simple registry.

"I'm just amazed, given what so many of your colleagues said during the business-license-tax campaign, for you to come in with, frankly, what I think are quibbles," Klein said.

It would be nice, he added, to hear the Chamber say "yes" for once.

"It'd be nice (for the Chamber) to say, 'This is something almost any city needs, and we're anxious to work with you to get the best possible business registry we can,'" Klein said.


Like this comment
Posted by Timothy Gray
a resident of Charleston Meadows
on Apr 30, 2014 at 11:04 am

The Business registry idea is a useful tool and needs to be supported.

Last time the registry was brought to the citizens as a Business Tax and was defeated.

The historical behavior has been to favor big businesses and penalize small businesses. To encourage the small start-ups, a provision should provide a free or very low cost registration for businesses less than five, so that we maintain and encourage an entrepenurial environment. Otherwise, downtown will become the domain of large corporations and we will loose the diversity that has made Palo Alto great. We must take extraordinary measures to welcome the little guy.

Also, if our real objective is having a complete registry, a free registration for the small businesses would then remove any incentive to fly under the radar.

Think about it.

Tim Gray

Like this comment
Posted by Joe
a resident of Another Palo Alto neighborhood
on Apr 30, 2014 at 11:13 am

> some of the questions on the city's proposed questionnaire for
> businesses, including ones relating to county health permits and
> tobacco sales.

It will be very interesting to see just what the City asks on this questionnaire. What could tobacco sales have to do with traffic, or parking? Nothing! But if the City wanted to be able to continue its social engineering--forcing companies to provide this sort of information might be one way for them to make claims about this, that, or the other that they could not otherwise.

To date--no one at City Hall has demonstrated any use for this information. Good that there is a Council election in the Fall--we'll get a chance to quiz any incumbants about how they have solved all the problems by having this information.

Like this comment
Posted by Entrepreneur
a resident of Crescent Park
on Apr 30, 2014 at 12:09 pm

I've run a solo practitioner consulting business out of my house for almost 30 years now. The article says home-based businesses are intended to be exempt from the registry. Is the text of the proposal available anywhere?

Like this comment
Posted by It's a TAX
a resident of Another Palo Alto neighborhood
on Apr 30, 2014 at 12:12 pm

So much for public input and transparency.

Like this comment
Posted by common sense
a resident of Midtown
on May 1, 2014 at 6:48 am

The city council members proposing the business registry says:

"Most cities rely on these tools for obtaining and analyzing critical information about the characteristics of businesses in their communities for purposes such as informing zoning decisions and public-safety planning and service response," the memo stated."

I would like to see the city council explain how this information would have helped their votes on past PC Zoning decisions, like the Lytton Gateway, College Terrace Center, or the Maybell Fiasco. Would they have changed their votes for Lytton Gateway if they knew there were 15,000 people who work downtown or 20,000 people who downtown? And if they want to know how many people are going to occupy Lytton Gateway, how is the developer going to know? and how is the developer going to know how many are driving versus taking public transit?

We already know about the parking problems downtown - it's all been well documented on how many parking spaces there are, the occupancy rate of the parking spaces, etc. by residents in Downtown North & Professorville. Does the city staff or city council not believe the residents?

The city council keeps saying other cities have a business registry or business license tax - give us some concrete examples from those other cities on how they use the information for zoning changes. But the council doesn't have any examples because cities have not used this information for zoning.

In my opinion if the city council feels this information is so important in making zoning changes, and they did not have the information, they should have never voted for the PC Zoning changes in the past. And it shows that they were basing their votes on other criteria - like helping the developers who were their campaign contributors.

Like this comment
Posted by Palo Alto Native
a resident of College Terrace
on May 1, 2014 at 7:28 pm

Great idea. Establish caps on number of workers per square feet an max captivity for events (first number lower than max capacity). This to counter open space work environments and overcrowding in general. Unannounced inspection officers to ensure conformity to capacity laws. Same applies to private homes with say 10 people living in a two bedroom home ( either a function of young professionals, multiple families, or cultural norms in foreign countries).

Sorry, but further commenting on this topic has been closed.

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