If Palo Alto adopts an annual cap on new office development in its main commercial corridors, it will have to do so despite intense opposition from the city's main land-use commission.
In an unusual split with the City Council, which unanimously endorsed the general parameters of the new office cap in March, the Planning and Transportation Commission just as unanimously panned the proposal Wednesday night.
Over the course of the discussion, the four commissioners present at the meeting characterized that the annual office cap as a blunt tool would be unfair to developers, distracting to the council and ineffective in reining in the city's pace of growth.
The commission was charged with reviewing the details of the new office cap, which would set an annual limit of 50,000 square feet for new office and research-and-development projects in the areas around downtown, California Avenue and El Camino Real.
While the council unanimously agreed to pursue the cap in March, council members struggled in June to come to an agreement on several key elements, including whether the cap should apply to portions of the city where the council plans to perform "coordinated-area plans" aimed at crafting a community vision for land use.
The planning commission was charged with reviewing and hashing out the details and returning with a recommendation.
The commission's deliberation was in some ways the polar opposite of the council's. The council, despite having a range of views about development, reached a compromise and took numerous unanimous votes. The commission, by contrast, quickly reached a consensus against the office cap, but concluded the meeting with a series of 2-2 votes and a lack of a resolution.
The commissioners split over whether it's best to simply vote against an ordinance that the City Council supports or to endorse an ordinance and try to make it more adequate.
In the end, Vice Chair Adrian Fine and Commissioner Mark Michael took the former option, while Commissioners Michael Alcheck and Kate Downing took the latter. The commission will discuss the ordinance again later this month, when more members are present.
Fine, who chaired the meeting in the absence of Chair Greg Tanaka, took the unusual move of crafting a motion outlining the commission's proposed changes to the ordinance. He then voted against his own motion. The cap, he said, "seems like a blunt interest to address quality of life issues."
He and his colleagues also agreed that the cap would be unfair to developers who have already invested large amounts of time and hundreds and thousands of dollars in their applications, only to see the rules change.
If the office cap were adopted, Fine said, it should take effect after the adoption date and not be backdated to include all applications that were deemed incomplete as of March 31, as the council proposed.
The commissioners made that determination after hearing from Ray Paul, vice president of Jay Paul Company, which is developing two projects in the California Avenue area. One of these, at 2747 Park Blvd., would bring 28,200 square feet of new office space to the district. Another, at 3045 Park Blvd., would demolish an existing auto shop and replace it with a 29,120-square-foot structure.
Both applications were submitted last October and deemed complete in April, just weeks after the City Council first agreed to pursue an office cap. Paul told the planning commission that his company had already spent more than $500,000 on the two applications and argued that subjecting them to the competitive process involved in the office cap would be unfair.
Paul criticized the council's decision to set the cutoff date at March 31, noting that the approach is unfair because it makes a "distinction without difference." Namely, it dumps Jay Paul's two projects into the same murky area that includes other recent submittals without recognizing the resources and time committed by the company to get this far in the process.
"Frankly, we don't think that this result is either fair or equitable," Paul said.
The council, for its part, agreed in June to give preferential treatment to projects like Jay Paul's, which had applications deemed complete between March 31 and June 30. This preferential treatment, however, does not entirely exempt these projects from the competitive process that would take place if the city gets development applications that collectively total more than 50,000 square feet in a given year.
The argument won sympathy from the commission, with Fine and Alcheck agreeing that the proposed office cap wouldn't be fair for developers. Both argued in favor of a "rollover" approach in which projects that would exceed the annual office cap would simply be delayed a year.
They also advocated for scrapping the competitive process for evaluating development applications in favor of a first-come, first-serve approach. In the end, however, Fine voted against the ordinance, arguing that it would not address the actual negative effects of new developments, like parking congestion and traffic jams.
Michael argued that the ordinance, which would be effective on an interim basis, would distract the City Council and staff from the more important tasks of updating the city's Comprehensive Plan and zoning code. Interim measures like this proposed office cap, Michael said, are "a distraction and should be avoided."
"The council, by focusing on interim ordinances, is taking its eye off the ball of the Comp Plan," said Michael, who joined Fine in recommending that the ordinance be rejected.
Alcheck, who reluctantly voted in favor of the ordinance, nevertheless, made it clear that the proposal brings him no joy and that he agrees with Michael.
"The writing is on the wall and I think the City Council is going to enact the ordinance irrespective of some of the concerns that Commissioner Michael has and that I share," Alcheck said.
Downing was similarly ambivalent as she made a case for why the proposed ordinance would not accomplish much. The office cap, she said, "just kicks the can down the road." It may slow down the effects of growth, Downing said, but it won't do anything to get rid of them or mitigate them.
"This doesn't really get rid of the problems that we have," she said. "It's just a Band-Aid. It looks good on paper and it sounds really great, but it doesn't really do much for us."
Downing and Fine agreed that if the ordinance is enacted, coordinated-area plans should be exempt. Unlike Fine, Downing ultimately joined Alcheck in voting for the ordinance.
Downing also shared the criticism of land-use watchdog and Palo Alto resident Bob Moss, who argued that limiting the cap to three areas -- downtown, California Avenue and El Camino -- would drive developments to other commercial areas, namely San Antonio Road and Fabian Way.
But unlike Moss, who argued that the cap should cover the entire city, Downing suggested that Palo Alto might be better off without an annual limit for office development.
"I can't help but feel like this ordinance is ill-advised," she said.