Concerned about office buildings squeezing out local neighborhood-serving retailers, Palo Alto officials on Monday proposed revising the city's zoning code to offer small businesses a little help.
The City Council debated a variety of proposals for relieving some of the pressure that small businesses have experienced in recent years, as rents have continued to soar in downtown and California Avenue. While the council didn't make any decisions, members agreed that the challenges caused by too much large-scale commercial growth demand solutions sooner rather than later. Several council members, including Pat Burt and Larry Klein, were particularly interested in near-term changes that can be implemented before the city completes the update of its land-use bible, the Comprehensive Plan.
Burt proposed a long list of zone changes for the city to explore, including putting more emphasis on housing in the downtown areas.
"My interest would be to look at reducing commercial zoning downtown and replacing it to some degree with residential," Burt said.
This would not be a "wholesale change" but a set of small adjustments, he said.
Burt also raised concerns about new businesses taking over basements in traditional retail buildings and filling them with office employees.
"Our code does not have anything that governs retaining basement areas as supporting retail," Burt said. "What we're seeing is large-scale conversion of retail-supporting basement to office."
His colleagues voiced similar concerns about retail's struggles and the need to offer stores near-term relief. Councilman Greg Scharff said it's important to make sure buildings on University and California avenues keep their retail spaces because once the use of those sites changes, it's hard to get retail back. He recited a catalogue of small downtown businesses that have recently left and were replaced by offices: Fraiche Yogurt (which moved down the block on Hamilton Avenue), Zibibbo, Rudy's Pub, and Jungle Copy.
Scharff said he'd like to see the city "expand retail" in downtown and California Avenue.
"Once you break the block, it gets so much harder to get it back," Scharff said. "I'm thinking the longer we dither on this and not take the bull by the horns on retail, the harder it is to solve the problem down the road."
He also agreed with Burt that "fake retail" is a "real issue."
"We want to make sure people don't run an office in the back and put fake retail in the front, basically," Burt said.
But Councilwoman Gail Price argued that the city should stay the course with its "Our Palo Alto" effort, a broad outreach initiative aimed at getting public feedback about the Comprehensive Plan update. It's not feasible, she said, to expect staff to proceed with this complex endeavor while at the same time managing dozens of different plans and initiatives relating to traffic, parking and zoning. She made a case for considering changes in the context of the broader discussion.
"We keep acting as if we have to do everything and do it perfectly by next week," Price said.
Councilman Marc Berman also said the different near-term initiatives should be pursued under the one "umbrella." Making big changes before the Comprehensive Plan effort is complete, he said. would be "totally unfeasible, and it's also the wrong way to go about achieving the changes that we all think are necessary in the community."
But most of their colleagues felt that the city needs to drastically rethink its zoning rules and that this should happen soon. Councilman Greg Schmid spoke at length about the predominance of offices in new downtown development. Just about every other city, including Mountain View, Menlo Park and San Francisco, creates plans that couple commercial developments with residential ones. Palo Alto, by contrast, seems to be only attracting offices.
"Everywhere in the west Bay, where the economy is booming, they are building mixed-use neighborhoods, with one exception: downtown Palo Alto, with it's 2 percent residential portion," Schmid said.
On Oct. 8, planning staff is scheduled to return to the council with a list of options for possible near-term zoning revisions.