Despite general consensus that downtown Palo Alto is the perfect place to add residential development, the City Council clashed on Monday over whether to move ahead with a housing plan for the transit-friendly area just east of the University Avenue Caltrain station.
The debate was prompted by an $800,000 grant that the city received last year from the Metropolitan Transportation Commission to develop a downtown housing plan, a vision document that would explore strategies and policies for adding housing. While the grant would help facilitate the planning process, City Manager Ed Shikada warned that it would not be enough to steer it to completion and estimated that the city would need to spend about $150,000 in local funds annually over the three-year planning period.
The effort got off to a shaky start on Monday, with just four council members — Mayor Pat Burt and council members Alison Cormack, Greer Stone and Greg Tanaka — voting to accept the grant funding to move ahead with the plan. Three of their colleagues — Vice Mayor Lydia Kou and council members Tom DuBois and Eric Filseth — dissented and argued that the housing plan would serve as a distraction from other ongoing planning efforts.
While the 4-3 vote allows the city to trudge ahead with accepting the MTC funds, it casts a cloud over a planning effort that staff was planning to kick off in the coming months. Crucially, the vote does not provide planning staff with the funding it had requested to launch the plan — funds that would be reimbursed by the MTC as part of the grant. That's because adjusting the council's budget requires a two-thirds council vote, a threshold that the council failed to meet.
The vote does, however, set the council up for another debate over the downtown plan in the coming weeks, as members kick off public hearings for next year's budget. The planning effort could hinge on whether council members choose at that time to authorize the funding.
Some council members strongly supported moving ahead with the plan, which targets a 76-acre portion of downtown that is roughly bounded by Alma Street on the west and Cowper Street on the east, between Lytton and Hamilton avenues. Council member Alison Cormack suggested that the timing of the plan is particularly suitable given the many changes that the area has experienced over the past two years, with the number of employees diminishing, the vacancy rate increasing and parklets becoming a permanent fixture of the streetscape.
"To me this plan will be one of the cornerstones of our new downtown," Cormack said. "And our downtown is going to have to change based on the pandemic. It's going to be different than it's been."
Others, however, argued that the downtown plan would take attention and resources away from the many planning efforts already underway. These include the drafting of Palo Alto's new Housing Element, a state-mandated document that lays out strategies for residential development and potential housing sites to accommodate the 6,086 residences that the city must plan for between 2023 and 2031. Palo Alto is also proceeding with work on streetscape improvements on University Avenue, crafting a permanent parklet ordinance and putting together an area plan for a portion of the Ventura neighborhood.
Kou suggested that the city should focus on the ongoing efforts and on "doing them well," rather than adding more to the workload. Filseth concurred.
"I just worry the whole thing is going to be a giant distraction," Filseth said. "There's a lot of ways this can go wrong. I think it's going to take on a life of its own and it's going to suck bandwidth, attention and resources away from what we really need to get the Housing Element done."
The idea of putting together a coordinated plan for downtown Palo Alto is far from new. The city's Comprehensive Plan includes a policy that explicitly calls for such an effort. And when the council debated its options for redesigning its rail crossing at Palo Alto Avenue in 2019, members agreed to defer the discussion so that the question can be considered as part of the broader planning process.
The downtown housing plan that the council debated Monday would not include consideration of rail crossings or transportation improvements. Its main focus would be housing and the boundaries of the planning area notably exclude the transit center at 27 University Ave., which includes a Caltrain station, numerous bus stops and the MacArthur Park restaurant. Planning Director Jonathan Lait said staff had proposed a relatively narrow scope — with a clear focus on housing — so that the effort could be aligned with MTC's funding proposal.
"This seems like a very timely grant so we're hoping to peel off the housing piece and really focus on that and we'll come back to the council when the time is right for the coordinated area plan," Lait said.
The Monday discussion suggests that the plan could still advance, though some of the details remained unresolved. DuBois took issue with staff's plan to hire consultants to shepherd the downtown effort and suggested that it would be more beneficial to hire a long-term planner who could work on the various efforts pertaining to downtown. He also suggested that the downtown plan is "out of order" given all the other planning efforts already in the works.
Supporters of the downtown plan maintained that the effort, while time-consuming, aligns well with the city's efforts to create more housing and to convert some of the commercial properties in transit-friendly areas to residential use.
"I think that looking at housing opportunities and particularly ones that would potentially adjust us from greater office growth to greater housing growth downtown is an appropriate approach and worth our effort," Burt said.
Stone, who also supported advancing the plan, argued that a failure to do so would demonstrate to regional and state agencies that the city is not making the necessary efforts to meet its housing goals.
"I think it's damning evidence that we left $800,000 on the table to be able to redevelop a housing work plan," Stone said.