News

Palo Alto opts to retain, fix contentious zoning tool

City Council rejects proposed reforms, embarks on long road to fix "planned-community" zoning process

Palo Alto's controversial "planned-community" process, which allows developers to barter with the city over zoning exceptions, will remain suspended for what could be years as officials continue to wrestle with ways to restore public trust in what they acknowledge is a "broken" system.

The City Council agreed early Tuesday morning not to adopt the reforms recommended by planning staff for the contentious zoning tool, which has been around since 1951 and has enabled about 100 developments, from the Opportunity Center on Encina Avenue to the new Edgewood Plaza on Embarcadero Road.

Instead, the council voted to defer any action on planned-community (PC) zoning until after the city adopts its long-term vision document, the Comprehensive Plan. Once that happens, a specially appointed council committee will begin to rehabilitate the deeply unpopular zoning mechanism.

Initially used for affordable-housing projects and social-service developments, PC zoning has grown more contentious in recent years as developers have increasingly relied on it to build office projects at greater heights and densities than the city's zoning code would otherwise allow. In exchange, they have offered "public benefits," such as public plazas, affordable-housing units, public art and funding for parking programs.

The SurveyMonkey headquarters at 101 Lytton Ave. and the College Terrace Centre project at 2180 El Camino Real both won approval under this designation. The housing development proposed for a site on Maybell Avenue, which included 60 units for low-income seniors and 12 market-rate homes, also sought and won the council's approval for a PC zone before voters overturned it in 2013.

The Maybell referendum prompted the council to adopt a "time out" on planned-community projects to consider ways to reform it. For that past year and a half, planning staff and the Planning and Transportation Commission picked apart every aspect of the current ordinance and proposed a set of reforms that includes a new "pre-screening" requirement for all applications;" a "monitoring and enforcement" plan that must be included in each application; an economic analysis that must be performed before a project is approved; and a new definition of "public benefits."

The goal was to add some transparency and predictability to the process. The council agreed late Monday night that the proposed reforms fall short of that goal.

In considering future changes for planned communities, the council split over whether the process is worth saving at all. Councilmen Tom DuBois, Eric Filseth and Greg Scharff favored killing the process entirely, while Councilwoman Liz Kniss cited the community's frustration with planned communities and declared it "broken beyond repair."

"It's pretty clear to me that the community is saying, 'We're kind of done with PCs,'" Kniss said. "We'll find something else in the future, but at the moment, I think it's finished."

Yet Kniss and five of her council colleagues ultimately agreed to pursue the reforms anyway. In an unusual split within the council's slow-growth "residentialist" wing, Mayor Karen Holman and Councilman Pat Burt each made a case for preserving and fixing PC zoning.

The reforms proposed by the commission and staff, Burt argued, fall short of the council's direction. He proposed forming an ad hoc committee to take another look at possibly reforming the PC process or, failing at that, putting the final nail in its coffin.

"I think we need to go through the additional analysis to make a good, quality decision," Burt said. "If that decision is to eliminate it, I'm fine with that. I don't think we've gotten to that point."

Holman agreed and said that there are "systemic issues" the city needs to deal with to improve its review process. These issues, she said, are not specific to PC zoning but involve broader conversations about enforcement and zoning exceptions. She agreed with Burt that it would be worthwhile to create a committee that would consider these fixes.

"I believe there have been some beneficial projects in this community that have been PCs," Holman said. "Many have been affordable-housing projects."

DuBois and Filseth, whose views on new development generally align with Holman's and Burt's, took the opposite stance and urged abolition. DuBois said the city has other incentives on the books for encouraging affordable-housing projects, such as the state-mandated density bonus that such projects are entitled to.

The city can also create master plans or "concept-area plans" that include affordable housing or, if needed, resuscitate the PC zoning in the future. For now, he said, staff and the council would be better off spending its energies on other issues.

"To me, this process, even with the cleanup suggested, is not worth the cost-benefit of actually having PCs," DuBois said.

Filseth agreed and said the city should look for other ways to get the type of developments it wants. At this point, he said, most voters in Palo Alto see planned-community projects as "loophole bombs that are more trouble than they're worth."

"I think we should kill them and focus on finding out how to get what we really want for the community in the future," Filseth said. "If a future council decides PCs are a good way to do it, they can always be brought back."

Scharff said he believes that there's currently no trust within the community in the PC process and this feeling won't ever change. Even projects that offer significant public benefits, such as Jay Paul's proposal to build a new police headquarters for the city in exchange for permission to build two commercial buildings at 395 Page Mill Road, faced an intense backlash from the public.

"I just don't think it's possible to reform the PC process," Scharff said. "I think any ordinance they bring back to us, people will send us 100 emails saying why it's bad."

There's no trust in violating zoning or selling zoning exceptions for cash, a practice that is deeply unpopular but that would have been allowed (and codified) under the the planning commission's reform proposal.

"All PC projects will either have trivial benefits ... or be so big that people will hate them," Scharff said.

But rather than kill the process, the council ultimately agreed to keep it on life support. With four members of the council's slow-growth "residentalist" faction evenly split (DuBois and Filseth favoring abolition and Burt and Holman resisting it), it fell to the fifth to make a compromise that effectively ensured that PC zoning won't be back any time soon.

Vice Mayor Greg Schmid made a proposal to delay the reform process until the city completes its Comprehensive Plan update, a process that was launched in 2006 and that the city hopes to complete by the end of 2016. Only once that's done will the city embark on a long, committee-driven process of reviving PC zoning.

Schmid's amendment was approved 6-3, with Burt and Holman, and Councilman Cory Wolbach dissenting. The vote means that it will be at least a year and a half before the long process of rehabilitating PC zoning can even begin.

Despite the late hour of the discussion, which stretched well past midnight, more than a dozen residents stuck around to voice their opinions about the PC process. Almost all of them blasted the way the process has been used and criticized the changes proposed by the planning commission and staff.

Robert Smith, a resident of Greer Road, called the existing PC ordinance "a failure" and said it should either be repealed or "very substantially altered."

"The proposed changes are window dressing and simply signal a return to business as usual," Smith said.

Cheryl Lilienstein, president of the citizens group Palo Altans for Sensible Zoning, said the group favors eliminating PC zoning, which she said "has been abused and used to circumvent the zoning regulations that help protect us all."

Land-use watchdog Bob Moss called the process a "racket," cited several examples of public benefits that never materialized and noted that the city has never fined a developer for failing to deliver the promised benefits (that could change after Sept. 30, when the city plans to start fining the developer of Edgewood Plaza $500 per day for failing to keep a grocery store at the plaza, as required under the PC zone. The store at the site has been vacant since Fresh Market left in late March).

Among the speakers Monday, Patricia Saffir was the lone exception. Zoning regulations, she said, "are by nature inflexible and arbitrary."

"We need a way to respond to unforeseen opportunities," Saffir said. "PC zoning has done that for us over the years, resulting in numerous projects that have been a credit to the city."

Comments

17 people like this
Posted by Joe
a resident of Another Palo Alto neighborhood
on Aug 25, 2015 at 12:36 pm

Time to put PC zoning on the ballot. The Council doesn't seem to be representing Palo Altans as much as it is taking care of the interests of their developer friends.


6 people like this
Posted by Joseph Baldwin
a resident of University South
on Aug 25, 2015 at 12:41 pm

PC Zoning Enjoys Palo Alto Process!
Council kicks 50-year-old can down the road -- again.
"We don't have enough data to make a good decision and
staff doesn't have time to gather it because they're
already overloaded with 61 assignments from council.
Let's wait until we adopt new Comp Plan, THEN we'll
go back to PC issue."
Maker of motion repeatedly states axing PC may well
be right, but 6 times (!) repeats in great detail
why not to do so now. Typical unnecessarily long meeting.
Neighbors, sadly we still have a council majority who agree
"we're here to lead voters, not heed them."
Joseph Baldwin
850 Webster Street




8 people like this
Posted by resident
a resident of Downtown North
on Aug 25, 2015 at 1:18 pm

That is Pat Burt you are quoting. Asking for more data is the current mantra of those who protect developers. No matter how obvious a problem is, they want more data.

Burt has alliances with developers that pop up every so often. He puts his residentialist face on when he needs to, then he returns to where the money is.


3 people like this
Posted by Chris
a resident of University South
on Aug 25, 2015 at 2:08 pm

If affordable housing, then drive all benefits to housing or cash for housing. Don't allow art work, park lets or other small projects to divert attention from the main problem. That way all PC benefits can be compared apples to apples. Currently, it is impossible to realistically compare PC benefits.


4 people like this
Posted by Boot them out
a resident of Crescent Park
on Aug 25, 2015 at 2:41 pm

[Post removed.]


Posted by Downtown resident
a resident of Downtown North

on Aug 25, 2015 at 2:57 pm


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7 people like this
Posted by Midtown
a resident of Midtown
on Aug 25, 2015 at 4:33 pm

One simple fix! Just let folks vote on each "PC" project paid for by the applicant. Benefits not good enough, project dies. Simple and clean, no monkey business, no thousands of hours of staff time "studying" the project.


5 people like this
Posted by Citizen
a resident of Another Palo Alto neighborhood
on Aug 25, 2015 at 6:23 pm

@Midtown,
That's a great idea, with one fatal flaw (that can be solved). Right now, when there is an election, the City staff/Attorney get to write the ballot. This is why the Measure D election was so contentious. the City used the ballot and even the ballot question to pitch the result they wanted. An analysis of the "impartial analysis" found the ballot so biased, it was probably illegal.

We need to change our election code so that the ballot process is impartial, like San Francisco does for example. This will make voting on PC projects a fairer reflection of whether the benefit is really a benefit.


6 people like this
Posted by Jennifer
a resident of Downtown North
on Aug 25, 2015 at 7:22 pm

I was surprised that karen holman spent most of her time defending PC and even condescended to lecture people on why they shouldn't expect elected officials to do what voters want. I think having a little power has gone to her head. I voted for her and had high hopes that she wouldn't play the usual games. But after listening to her last night I kissed any hope goodby. She is no better than the usual.


Posted by Reader
a resident of another community

on Aug 25, 2015 at 8:53 pm


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5 people like this
Posted by Amos
a resident of Community Center
on Aug 25, 2015 at 9:09 pm

I am pleasantly surprised that Scharff said "he believes that there's currently no trust within the community in the PC process and this feeling won't ever change."

I am disappointed, and not surprised that Liz Kniss, whom it seems has yet to meet an over stuffed development not worthy of approval, declare the Planned Communities process "broken beyond repair", and then vote to keep it alive! Listen to what I say, not what I do.

And it seems that the members of the Planning Commission have been living under a really big dumb dumb rock as they appear to be oblivious to the complete disgust and distrust many residents have over the PC system that has allowed developers to offer crummy bribes to speed their awful projects through the approval process, and make that corrupt bribe process written into city code! Who is pulling their strings? A really unbelievable in your face move by the Planning Commission, with city "planning staff", and I assume the city manager, cheering, hoping, silently in the background?


1 person likes this
Posted by give Holman credit
a resident of Another Palo Alto neighborhood
on Aug 25, 2015 at 10:53 pm

Holman gave a perfect description of the State of the City when she said several times "it's a systemic problem". It's the long-running culture of City Hall. This was about more than a bunch of emails regarding PC's.Give Holman credit. That was the most important comment of the evening,from a Mayor, and the take away from this meeting. This meeting was a good first step and hopefully the tone and momentum will continue.It appeared that the Council as a whole finally gets it- that we have been on the wrong course and the problems and impacts are blowing up in our faces and everybody knows it. So the meeting had a sadness to it, but also a sense of reality beyond the usual rhetoric, and also a sense of hope for the first time in a long time of a more responsible and enlightened government going forward. Let's hope so.


6 people like this
Posted by Charles
a resident of Midtown
on Aug 26, 2015 at 7:41 am

The above comment in defense of the mayor has a ring to it that makes me think another council member wrote it. What I saw was a superior attitude by Holman coupled with her saying that she was free to ignore the public. She seems full of herself and it comes across in meetings. Come on. And we have decades of experience with PCs and hardly need to do some big study as Burt got pushed through.


6 people like this
Posted by give Holman credit
a resident of Another Palo Alto neighborhood
on Aug 26, 2015 at 9:02 am

@Charles
No defense of anybody is in order. Look, the City is in a freefall and it
is painfully obvious. Things are completely out of control here. So finally a Councilmember, the Mayor, says we have a "systemic problem". Voila! Did she mean let's tweak things or did she mean we are in serious trouble and we need a new mindset and a new way of doing things? Let's see. Remember she said months ago that we need to change the ARB process, which is consistent with this comment.



8 people like this
Posted by Anna
a resident of Downtown North
on Aug 26, 2015 at 9:45 am

Of course the Council pays lip service to residents' concerns about the PC process ... and then votes to keep it. Alternative ways to handle development of new projects in Palo Alto don't offer the same opportunities for graft that the PC zoning process does.


8 people like this
Posted by Curmudgeon
a resident of Downtown North
on Aug 26, 2015 at 12:09 pm

The whole thing was upside down on the dais; the councilmember recommendations were directly opposed to the speakers' well known views. Something was clearly amiss here.

And the unseenly rush to rescue the PC by the mayor et al. was transparently scripted. A few more rehearsals might have enhanced its credibility. Take note, colleagues.

Brown Act, where are you when we need you?


12 people like this
Posted by mauricio
a resident of Embarcadero Oaks/Leland
on Aug 26, 2015 at 1:04 pm

mauricio is a registered user.

The mayor deserves no credit at all. She had an opportunity to eliminate the PC process once and for all, and deliberately kept it alive. As long as this process is alive, the capacity for shenanigans involving council members, staff and developers is alive as well.


10 people like this
Posted by Play it again, Holman
a resident of Another Palo Alto neighborhood
on Aug 27, 2015 at 2:31 pm

As usual, too little, too late. Just a bandaid on a slit throat.


7 people like this
Posted by resident
a resident of Downtown North
on Aug 27, 2015 at 11:28 pm

Curmudgeon put it right,
>the councilmember recommendations were directly opposed to the speakers' well known views.<
What are they up to? what is Scharff's game, with this big turnaround?
Holman seemed stuck on several worthy PCs. As though that makes the corrupt process ok.
No surprised from Wolbach, Kniss and Berman.

Burt was very much in favor of particular projects, for example the Lund & Boyd Smith PC project at 335 Alma (Lytton Gateway). Oversized, underparked, reduced setbacks, the works. He even maneuvered that the Below Market Rate offices which were a "benefit" would go to the Chamber of Commerce. Yes, it is true. Many many developers rewarded him handsomely in 2012 election contributions.


Like this comment
Posted by Jerry Underdal
a resident of Barron Park
on Aug 29, 2015 at 11:27 pm

Jerry Underdal is a registered user.

The council discussion of the Planned Community process was Television Worth Watching in my opinion. I felt there was a true back and forth about how to proceed and, finally, a reluctance to throw out this tool without looking at the successes as well as the failures of the PC process over the years prevailed in a split vote.

Continuing the moratorium on Planned Community projects while researching other possible ways to do projects with significant public benefits, e.g. affordable housing, seemed to me to be a reasonable move. All council members agreed that it was important to keep affordable housing in Palo Alto. Whether that's possible without the PC option is a question that I hope the City Council can agree on in coming months, so Palo Alto can move forward in adding more affordable housing units to the available stock.

This is not a matter of charity, but of responsible housing policy.


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