Palo Alto may drop plan for transportation tax

City manager recommends that the council defer action on business tax to pay for transportation projects

Despite widespread recognition that traffic congestion continues to be a pressing priority, Palo Alto is considering backing away from a long-discussed plan to create a business tax that would pay for transportation improvements.

City staff has been exploring a tax proposal for more than a year. Last year, the city commissioned surveys to gauge public opinion about a new business tax and agreed to appoint a citizen committee to vet the potential tax measure. In December, the council approved the membership criteria for the 16-member committee, which would consist of business leaders, residents and transportation experts.

Now, City Manager James Keene is recommending that the city make a U-turn on the new committee and defer any action -- a suggestion that the City Council will consider on Monday.

In making the recommendation, Keene cited the many transportation initiatives that the city currently has underway, a list that includes various bike improvements, two new garages (one near California Avenue and another downtown), a public-outreach process centered on Caltrain grade separation and the proposed expansion of the city's free shuttle. Most of these projects, he wrote, have "demanding requirements and usually even more demanding community engagement requirements."

"The same transportation staff who would be most involved in any transportation stakeholder-group process are already heavily involved in these projects and couldn't realistically support this transportation-tax process without seriously compromising these other important initiatives," Keene's report states.

Given the growing workload, Keene recommends that the council revisit the need for a tax in 2018 or subsequent years, "when staff can effectively support a demanding public-engagement process."

The council's desire to move ahead with a new tax was fueled in large part by its desire to raise money for the Palo Alto Transportation Management Association (TMA), a nascent nonprofit charged with reducing traffic by getting drivers to switch to other modes of transportation. Just this week, the council voted to approve a new long-term transportation vision that puts a heavy premium on reducing the number of solo drivers to and within Palo Alto.

The newly approved Transportation Element states that the key to a sustainable transportation system "lies in providing more options and more convenience so that people will more readily choose not to drive."

"Palo Altans recognize that, at times, driving is necessary, but to address congestion, climate change and improve overall quality of life, the policies and programs in this Element must focus on providing convenient, affordable alternatives to the automobile," the document states.

The Transportation Element also includes several policies focusing directly on reducing car commuting, including one that calls on the city to "collaborate with Palo Alto employers and business owners to develop, implement and expand comprehensive programs like the Transportation Management Association (TMA) to reduce single-occupant vehicle commute trips, including through incentives." Another program calls for expanding the TMA from downtown to California Avenue and other areas of the city when appropriate.

To date, the council has been talking about the new business tax as a possible source of funding for these efforts. In addition, the city has recently completed a parking study that suggested switching to paid parking in city-owned lots and garages. Parking revenues would be used to support the TMA and other traffic-reduction efforts.

While the city has been considering a switch to paid parking for several years now, Keene pointed to the new study as another factor in his recommendation to defer moving ahead with the tax. The new Downtown Parking Management Study, Keene wrote, has offered a new revenue-raising possibility with a "clear geographic nexus." An April 11 report from the Department of Planning and Community Environment noted that after the city makes the needed investments, "any net excess revenues could be used to support the nascent Palo Alto Transportation Management Association."

During the council's April 11 discussion of the downtown parking study, Keene suggested that the parking revenues may be enough to keep the TMA afloat.

"Once we had gotten through the capitalization and the implementation phase, there would be clearly a sufficient revenue stream to clearly support our TMA objectives and TDM (transportation-demand management) investments that we want to make that would have a reciprocal benefit on our overall parking and traffic situation," Keene told the council on April 11.

When the council directed staff to establish the new stakeholder committee, members were hoping to have the group complete its work by this fall. To date, however, there's been little progress. The city had extended the deadline for applications several times and ultimately received 39 applications, according to Keene's report. The outreach process, he wrote, had some challenges, with potential applicants asking about the "scope, purpose and portfolio of responsibilities of the committee."

Since then, Keene wrote, "No further action has been taken on the formation of the committee."

If the City Council moves ahead with Keene's recommendation, it would effectively abandon its plan to move ahead with a transportation tax this year.

"There should also be more specificity about funding needs, potential uses of revenues and identification of gaps in the City's overall transportation strategy by the beginning of next year that could inform the Council's decision and bring more initial clarity to any tax stakeholder process," Keene wrote.


Follow the Palo Alto Weekly/Palo Alto Online on Twitter @PaloAltoWeekly and Facebook for breaking news, local events, photos, videos and more.

What is democracy worth to you?
Support local journalism.


14 people like this
Posted by George
a resident of Old Palo Alto
on May 2, 2017 at 8:01 pm

It was a dumb idea anyway. If you have a moment, take a look at

Web Link

Other than creating a few billionaires who then move to new Zealand or anywhere else out- of- state (one is discussing going to mars) california and the gadgets and platforms for bullying and marketing everyone's privacy, California isn't exactly delivering good housing or good communities. Reasons to seek fortunes elsewhere are growing as the costs, housing shortages, traffic, school, lack of good communities, sprawl, congestion, regulations and the simple business of day to day just becomes too challenging for too many. More taxes, more bond issies, more studies - same old problems getting worse.

Palo Alto may end up as Yogi once quipped - no one goes there anymore, it's too crowded.

14 people like this
Posted by resident
a resident of Professorville
on May 2, 2017 at 9:19 pm

Pressure from landlords afraid that a business tax will affect their rents?

25 people like this
Posted by Online Name
a resident of Embarcadero Oaks/Leland
on May 2, 2017 at 10:23 pm

Certainly would be wrong to tax businesses when the city and the TMA can tax residents instead, making US pay for the commuters who flood our fair city via the TMA initiatives for us to pay $2 per day for each carpool -- including those transporting city govt. employees -- and to pay the full cost of public transit for out-of-town consumers.

And then there's the parking permits, parking meters, garages, etc etc. -- all to subsidize the commuters TRIPLING our population and worsening the gridlock.

I'm just so thankful that the Palantir-run TMA and City Counsel are watching out for business interests instead of ours! And of course the TMA needs to expand and needs more of our tax dollars.

What "free city shuttle"?? It's not free because we're paying the increased sales tax while getting no VTA service BECAUSE PA's got that "free" shuttle. Too bad our transportation experts, commissioners, council etc never bothered to coordinate that with the VTA .

11 people like this
Posted by Outreach Clarfication!
a resident of Adobe-Meadow
on May 3, 2017 at 10:16 am

So they're still working on clarifying what outreach means? Great. Maybe they can get it together to reach out to the residents effected by the proposed changes and actually notify us when a change like banning parking in front of our homes is being contemplated.

The current "outreach" program fails miserably to reach out and touch the right people.

Maybe they could reach out to residents to ask OUR opinion on their traffic-reduction goals???

23 people like this
Posted by Midtowners
a resident of Midtown
on May 3, 2017 at 11:04 am

So am I understanding this correctly? We can't pursue a tax on the businesses who are causing the traffic problem, because we're too busy building garages for those businesses so that they can fit more cars in our city?

And I'm not surprised that our current City Council hasn't pressed the issue. They're too busy kowtowing to all businesses (trying to turn all our houses into software labs) to even consider taxing those companies.

5 people like this
Posted by Aaaaargh.
a resident of Greenmeadow
on May 3, 2017 at 11:19 am

The city is trying to do too much too fast. Slow down. Finish projects you started and let slide before you add new ones. Staff, that goes for you, too.

Take time to understand issues and build consensus. Council is not serving us well with last minute amendments and pot shots at each other. Both sides of the issues are equally at fault. As a citizen who watches these meetings, I find it tiresome and embarrassing.

Like this comment
Posted by Gale Johnson
a resident of Adobe-Meadow
on May 3, 2017 at 12:40 pm

How was the business tax supposed to work? How much revenue was expected? Whatever happened with the Business Registry? That was supposed to provide a lot of valuable information for city planning and CC. What, if anything, helpful, came out of it? Did it just die or fade away?

7 people like this
Posted by Fool Me Once
a resident of Crescent Park
on May 3, 2017 at 12:44 pm

@Aarrgh, of course you're right but certain members of our City Council and their commissions refuse to understand the issues and consider the consequences because governing by sloganeering is so much easier than doing the hard work.

When confronted with facts and consequences, they dissemble and attack the critics rather than dealing with the issues. Shameful when we're supposed to be an educated logical community.

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

All your news. All in one place. Every day.

A new home in Redwood City for Mademoiselle Colette's croissants
By Elena Kadvany | 1 comment | 8,236 views

Electric vs Gas Heat: Which wins?
By Sherry Listgarten | 18 comments | 3,832 views

Lights Out! Foods to Snuggle With in the Dark
By Laura Stec | 0 comments | 1,680 views

What to do with all those cardboard boxes
By Cheryl Bac | 2 comments | 1,464 views

Some answers, please, PG&E
By Diana Diamond | 6 comments | 859 views


Race Results Are In

Thank you for joining us at the 35th annual Moonlight Run & Walk! All proceeds benefit the Palo Alto Weekly Holiday fund, supporting local nonprofits serving children and families.

Click for Race Results