Deal reached to save Mountain View's Milk Pail

Council delays San Antonio project, wants to add housing

Milk Pail Market owner Steve Rasmussen and developer Merlone Geier announced Tuesday night that they had reached a last-minute deal to save the Milk Pail, before City Council members ultimately decided to delay the second phase of Merlone Geier's Village at San Antonio Center development in order to replace half the office space in the project with housing.

Addressing a major community concern while bolstering support for a controversial project, Mike Grehl of Merlone Geier said it was his pleasure to invite Rasmussen to the podium to announce the agreement in front of those who packed the City Council chambers Tuesday, July 1. The agreement grants Milk Pail customers access to 11 parking spaces in a nearby parking garage, enough to meet city requirements for the Milk Pail market to stay in business past 2016, when its current parking agreement expires.

"For the past several days my team has been working furiously on an agreement to allow the Milk Pail to remain in business where we have always been," Rasmussen said, adding that it would apply only "if and when phase two is approved."

Merlone Geier's second phase of development at the San Antonio shopping center is slated to replace Ross and BevMo at San Antonio Road and California Street. It includes a 167-room hotel, a large public square, 109,000 square feet of retail space, a 50,000-square-foot movie theater and a six-level parking garage with just over 1,300 parking spaces, and an office garage with 1,174 spaces.

"The length of the term is substantial and that would allow us to be around for quite a long time," Rasmussen said.

Grehl had previously said any further delays would kill the project, but was amenable when members voted 6-0 to delay the project and to study a compromise for more housing. It would remove one of two proposed six-story office buildings and replace it with what city staff said might be 115 housing units within the same footprint.

Inks can't vote

Council member John Inks had to leave the dais the California Fair Political Practices Commission said that, even under new conflict of interest rules, Inks must continue to recuse himself from the project. Inks owns property within 500 feet of the San Antonio precise plan area, but Merlone Geier representatives sought a clarification of the rules in hopes that Inks could vote on the project. The FPPC determination was made just an hour before the meeting, clearing up confusion and concern that Inks would be a swing vote to approve an unpopular iteration of the project.

Housing needs

Residents of the 330 apartments in the first phase of Merlone Geier's development spoke in favor of phase two, but most people who packed the meeting called attention to the area's housing shortage and how adding as many as 2,500 office workers to the city in the two proposed office buildings would speed up the area's gentrification.

"There are a lot of beautiful things about this project, then there's this jobs-housing imbalance thing, and I can't not think about that," said Edie Keating of Peninsula Interfaith Action. "The jobs-housing imbalance distorts so many things in our community. It creates traffic jams and it breaks up families. In our church we see young folks and retirees leave our area. Communities are being broken up by this jobs-housing imbalance. It affects everyone, whether you are a renter or a homeowner. You've got a great project, you need to make it morally right by substituting the office for housing."

The group leading the effort to remove office space and add housing to the project isn't satisfied with the compromise proposed by Mayor Chris Clark to replace only half of the office space with housing. Merlone Geier said that removing all of the office space and replacing it with housing would trigger a lengthy delay to study the impacts and comply with the California Environmental Quality Act.

"We would like more than the compromise offers," said Lenny Siegel of the Campaign for a Balanced Mountain View. "There are still too many jobs proposed."

Referendum threat

Siegel said that the group has yet to decide on a way forward, but said in an email that it seemed "unlikely" that a referendum petition would be circulated to gather over 3,400 signatures to put the project up for a public vote. The group had planned to put a referendum on the ballot if the project is approved before the San Antonio precise plan comes up for discussion to consider housing and other needs for the San Antonio area.

Grehl touted the $7 million in public benefits that would come with the Merlone Geier project, including a protected bike lane along California Street, a $300,000 monument to the birthplace of Silicon Valley at 391 San Antonio Road, new bike lanes on San Antonio Road and $750,000 toward a pedestrian tunnel under Central Expressway at the San Antonio train station, to which other developers in the area would contribute, according to Planning Director Randy Tsuda.

Grehl added that the project would bring $2.5 million to the city in the form of property taxes and sales tax revenue. An estimate of how much revenue would be created if the project were killed was not included; Merlone Geier has said it would alternatively build a two-story, 175,000-square-foot retail project along the southern half of the site, which the council had already approved with phase one several years ago. There would also be $5.3 million in below-market-rate housing fees, which council members said would pay for only about six subsidized homes for low-income residents.

"I want Mountain View to stay a diverse community," said resident Joan Bradovsky. "The only way to increase housing is to build it. Even if you build more and it's not affordable, at least it would take some pressure off (older housing stock). I hope you do that, you have the authority to do so."

"While I benefit from the housing-jobs imbalance on paper, I just think it's wrong," said longtime resident and homeowner Paul Davis, referring to how his property value is rising. "I agree it's a moral issue. The city has failed to address the housing-jobs imbalance and that's something I urge you to do ... so that our community can be whole."

Council members said they wished residents had been such advocates for controversial housing projects that they scaled back or killed in the past following public opposition, and they encouraged the public to continue their advocacy for housing. They said they would finish making most major decisions on the San Antonio precise plan including whether to make housing a higher priority at a July 8 study session to be held at the Senior Center.

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4 people like this
Posted by Resident
a resident of Another Palo Alto neighborhood
on Jul 2, 2014 at 12:36 pm

Good news indeed. I do hate what they are doing to the San Antonio Center, not a useful destination apart from Safeway in the first phase and I hope the new phase will be remain useful. Shared parking makes so much sense, who wants to have to park several times on a shopping trip? Plus, someone shopping at Milk Pail is likely to be there a lot less time than someone having dinner or going to a movie.

4 people like this
Posted by Long-time resident
a resident of Another Palo Alto neighborhood
on Jul 2, 2014 at 1:20 pm

"Even if you build more and it's not affordable, at least it would take some pressure off (older housing stock)."

What a laugh.

Look up "non sequitur"

4 people like this
Posted by If wishes were horses...
a resident of Another Palo Alto neighborhood
on Jul 2, 2014 at 1:28 pm

I wish they would cancel phase II in the altogether....or at least downsize it drastically. The intersections around San Antonio shopping center are miserable as is and it just isn't worth more misery. While a theater might me nice, there are already enough restaurants and retail shops; it would be a bad idea to lose BevMo.

As the current plan stands, it creates too much noise, pollution, traffic jams, etc. Other than to make another developer even more outrageously wealthy, why do this? It really benefits no one but the developer.

4 people like this
Posted by Neilson Buchanan
a resident of Downtown North
on Jul 2, 2014 at 2:48 pm

Steve, it would be helpful if you could dissect the big issues into more specific sub-issues. Allow me to illustrate with "Walkable neighborhoods with good retail options". One sub-issue is the nature and density of housing units. A second sub-issue is the variety of retail spaces to serve those residents. You could blog ideas, options, strengths, weaknesses of planning for those retail options. I think too many of us don't understand or trust the vague Comp Plan will prevent University Avenue, for example, from morphing rapidly into office and retail (primarily restaurants).. office space and retail targeted for workday office workers and hordes of evening/ weekend non-residents. As a resident of Downtown North, I find retail options declining and restaurants increasingly pricey and not as good as nearby cities for everyday family dining. A factual 5 year analysis of retail to office conversion is overdue. And a few scenarios for the future would build public confidence that city government is monitoring the factors that result in walkable, livable neighborhoods.

4 people like this
Posted by randy albin
a resident of Mountain View
on Jul 2, 2014 at 4:21 pm

it's good if this business can be salvaged. it is from way back when the shopping center was going on long ago. steve rasmussen operated the milk pail way back when. it could have been a drive-through. best wishes and continued success

4 people like this
Posted by Bad Design
a resident of Another Palo Alto neighborhood
on Jul 2, 2014 at 9:41 pm

What about schools...if they build housing? The kids in the area are assigned to Los Altos schools but Mountain View City Council is making the development decisions here...rather irresponsibly, I think. From what I understand, there's not adequate capacity there for more kids. What will Mountain View do to mitigate the school impacts they are creating?

In addition, little has been said here about the abysmal transportation elements of Phase I. I am a very skilled bicyclist, and I find the circulation throughout the site to be very poorly planned. Also, the sight lines at most internal intersections are terrible for bikes and pedestrians. They placed tall landscaping and signs so close to intersections that drivers cannot see pedestrians on the sidewalk or approaching bicyclists.

The main entrance has bicyclists merging (see sharrows) with auto traffic in the main entrance to the site, an area where tall buildings suddenly create a heavily shaded and dark environment. Drivers are blind for a moment when they enter it. I used to go there a couple times a week before Phase I. Now my visits are more like once a month. It's awful.

I hope everyone has been watching John Inks behavior. That he thought it might be appropriate to vote says a lot about his character. He owns the Target site and is very busy protecting the profitability of his own investment rather than representing his constituency. Remember his behavior during the next election.

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