TO: HONORABLE CITY COUNCIL FROM: CITY

Transcription

TO:
HONORABLE CITY COUNCIL
FROM:
CITY MANAGER
DATE:
NOVEMBER 9, 2009
REPORT TYPE:
ACTION ITEM
SUBJECT:
Adoption of an Ordinance Amending the Palo Alto Municipal Code
Chapter 18.08.040 (the Zoning Map), Chapter 18.30(C) (the Ground
Floor (GF) Combining District), and Chapter 18.18 (the Downtown
Commercial Community (CD-C) Zone District) to Modify
Restrictions on Ground Floor Uses in the Downtown Area
DEPARTMENT:
PLANNING AND
COMMUNITY ENVIRONMENT
CMR: 420:09
EXECUTIVE SUMMARY
. The purpose of these changes to the Zoning Ordinance is to address concerns about the loss of
revenue generating retail and potential degradation of downtown economic vitality. Specifically,
degradation resulting from an increase in ground floor office space in the downtown core due to
dispersal of retail and personal service uses into the area outside the core. The existing Ground
Floor Combining District regulations allow the Director to approve ground floor office use if a
Use Exception is requested at a time when the City's annual downtown ground floor vacancy
rate calculation is above 5% if allowed by the underlying CD-C regulations. Since a vacancy
rate of approximately 10% is anticipated this year, the section of the code allowing Use
Exceptions is recommended to be removed in order to ensure preservation of downtown retail
uses. To balance this action, and concentrate retail in higher foot traffic areas, an amendment is
proposed to relax existing restrictions in the CD-C zone outside the GF combining district, to
allow the flexibility to lease ground floor space for either office or retail uses. Also
recommended are adjustments to the boundaries of the Ground Floor Combining District to
better reflect the critical areas of retail in the downtown core.
RECOMMENDATION
The Planning and Transportation Commission (P&TC) recommends that the City Council adopt
the proposed ordinance (Attachment A) to include:
•
Removal of PAMC Section 18.30(C).040 eliminating the option for a Use Exception
based on vacancy rate in the downtown core covered by the GF Combining District;
CMR: 420:09
Page 1 of5
•
•
Removal of PAMC Section 18.18.060(f)(1) providing an increase in flexibility for
ground floor uses in the periphery of the downtown; and
Addition of GF Combining District to the existing properties on the south side of
Hamilton Avenue (the 200 block between Emerson Street and Ramona Street) and to the
Aquarius Theater and the two restaurant sites immediately to the north on Emerson, to
protect these strong retail areas.
Staff generally concurs with the P&TC recommendations, but continues to support adjusting the
boundaries of the GF district to remove sites that are marginally viable for retail uses as
described below:
•
•
•
Removal of GF protection from properties along Alma Street, and portions of High Street
(near Hamilton Avenue);
Removal of GF protection from properties along the circle ramps connecting University
Avenue and Alma Street; and
Removal of GF protection from three miscellaneous non-retail parcels along Kipling and
Cowper north of University.
BACKGROUND
In order to address concerns about the vacancy rate of downtown ground floor retail spaces, the
P&TC initiated the zoning ordinance changes on July 22, 2009, requesting that staff conduct
outreach meetings with owners of property and businesses in the downtown core. City staff
attended and hosted meetings as described in the P&TC staff report (Attachment E). On
Septeluber 23, 2009, the P&TC reviewed the ordinance prepared by staff that was based on the
P&TC comments at the initiation hearing and comments from property and business owners.
The P&TC staff report provides additional background regarding the current Ground Floor
Combining District (GF) and the Downtown Commercial Zoning District (CD-C) code which are
included as Attachments B-D.
DISCUSSION
The draft ordinance (as recommended by the P &TC) is included as Attachment A. The proposed
ordinance is intended to modify the land use regulations in the downtown based on a reexamination of current conditions and the efficacy of the existing regulations. The goal of these
changes is to support the vitality of the downtown core of strengthening controls in the core and
allowing more flexibility in the periphery. Based on the discussion at the initiation meeting on
July 22,2009, and comments received dU11ng public outreach, staffmade four recommendations
to P&TC of what areas of the downtown should be included in the core as described in the staff
report dated September 23,2009, and in the discussion below.
COMMISSION REVIEW AND RECOMMENDATIONS
On July 22 and September 23, 2009, the P&TC held public hearings regarding the proposed
ordinance. There were two speakers at the first hearing and three speakers at the second hearing.
The P&TC staff reports, meeting minutes, and responses to Commissioners' questions are
attached to this report as Attachments E-I and are available on the City's website at
http://www.cityofpaloalto.orgicivica/filebank/blobdload.asp?BlobID=l7098
CMR: 420:09
Page 2 of5
The P&TC divided its recommendation into six separate votes.
1. The P&TC voted unanimously to recommend removal of PAMC Section 18.30(C).040 so
2.
3.
4.
5.
6.
that there will no longer be the option for a Use Exception based on vacancy rate.
The P&TC voted (4-3) to remove PAMC Section 18.18.060(f)(1) so that existing and future
retail located in the CD-C zone outside the GF zone could become office in the future.
The P&TC voted unanimously to add GF protections to the existing retail on the south side
of the block of retail on Hamilton Avenue (the 200 block between Emerson Street and
Ramona Street) and to the Aquarius Theater and the two restaurant sites immediately to the
north on Emerson.
The P&TC voted unanimously to not limit "uses of concern" (restaurants, financial
institutions, etc.).
The P&TC voted unanimously to retain the existing zoning of University Avenue east of
Cowper Street and the properties on Bryant between University Avenue and Hamilton
Avenue.
The P&TC voted (4-3) to retain the existing zoning of properties on Alma, High Street,
University Avenue, Kipling or Cowper.
Attachment A is the revised draft ordinance as recommended by the P&TC at the September 23,
2009, hearing.
In addition to the elements included in the formal recommendation other issues were discussed in
depth by the P &TC at the meeting. These include the following:
r.' Retaining the current restrictions on existing retail in the CD-C to apply to retail existing
between March 19, 2001 and 2009.
2. Adding the GF combining district to the properties located on both sides of Emerson Street
between Hamilton Avenue and Forest Avenue.
ALTERNATIVES
An alternative to the P &TC recommendation, as recommended by staff, would be to adjust the
boundary of the GF combining district to remove several properties including:
•
•
•
Removal of GF combining district from properties along Alma Street, and portions of
High Street (near Hamilton Avenue). (525, 529, 535-539 Alma Street, 115 & 135
Hamilton Avenue, 542 High Street)
Removal of GF combining district from properties along the circle ramps connecting
University Avenue and Alma Street. (115-119, 102-116, 124, 125 University Avenue)
Removal of GF combining district from three miscellaneous non-retail parcels along
Kipling and Cowper north of University. (440 Cowper Street and 437 & 443 Kipling
Street)
Staff supports this alternative in order to remove the ground floor restriction from sites that are
not viable for retail uses.
RESOURCE IMPACT
The GF cornbining district does not ensure that businesses will provide a point of sale (personal
service and service businesses which do not generate sales tax, are allowed in the GF), but focus
CMR:
Page
on the core of the downtown retail district would add to the vibrancy and walkability of the
business district. By clustering retail and personal service uses, retail studies show that foot
traffic and additional sales will result. For example, in the recent studies by Gruen & Gruen
Associates, retail experts in the Bay Area, found that "a critical mass of proximate and
synergistic retail" is required for a successful downtown district.
The additional proposed change recommended by the Planning and Transportation Commission,
providing flexibility to property owners to change from retail to other uses (after March 21,2001
or thereafter), would also allow owners to bring in retail tenants into formerly non-retail spaces,
by providing for reversion from retail to the former non-retail use. The potential economic
impact of this primarily is in the occupancy of buildings that have been left vacant rather than
locating a retailer that "locks in" the retail use forever. The lack of flexibility for marginal retail
uses (e.g., 529 Alma) has resulted in vacancies for as long as 3 years. With the ability to
alternate between retail and other approved uses, long term vacancies can be avoided and the
economic vibrancy of the shopping district will be maintained. Allowing this type of flexibility
will allow property owners to change from retail to other uses as the economy and demand for
space fluctuates.
POLICY IMPLICATIONS:
In addition to Policies that support the retail vitality of the University AvenuelDowntown area,
the Palo Alto Comprehensive Plan specifically directs evaluation of the ground floor retail
requirements through Program L-9:
Continue to monitor development, including the effectiveness of the ground floor
retail requirement, in the University AvenuelDowntown area. Keep the Planning
Commission and City Council advised of the findings on an annual basis.
ENVIRONMENTAL REVIEW:
This action is categorically exempt (per Section 15305 (Class 5) of the CEQA Guidelines) from
the provisions of CEQA as they comprise minor alterations to land use limitations and can be
seen to have no significant environmental impacts.
PREPARED BY:
DEPARTMENT HEAD:
Director of Planning and Community Environment
CITY MANAGER APPROVAL:
CMR: 420:09
Page 4
ATTACHMENTS:
Draft Ordinance with Exhibits (Exhibit 1, property list, and Exhibit 2, map
Attachment A:
showing proposed revised locations ofGF combining district)
Map showing existing location of CD-C zoning and GF combining
Attachment B:
Ground floor use restrictions for CD-C zoning district (pAMC Section
Attachment C:
18. 18.060(f)
GF zoning district regulations (PAMC Section 18.30(C).060)
Attachment D:
P&TC staff report dated September 23, 2009 (w/o attachments)
Attachment E:
Attachment F:
P&TC staff report dated July 22,2009 (w/o attachments)
Excerpt Minutes ofP&TC meeting September 23,2009 (Council only)
Attachment G:
Attachment H:
Excerpt Minutes ofP&TC meeting July 22, 2009 (Council only)
Attachment I:
Commissioner Questions and Response to Questions
CMR: 420:09
Page 5 of5
NOTE YET APPROVED
ATTACHMENT A
Ordinance No. - Ordinance of the Council of the City of Palo Alto Amending
Sections 18.30(C).040, 18.18.060(F), and 18.08.040 (The
Zoning Map) of the Palo Alto Municipal Code Regarding
Ground Floor Use Restrictions in the Downtown Area
The Council of the City of Palo Alto does ORDAIN as follows:
SECTION 1. The City Council finds that:
(a)
The Planning and Transportation Commission, after a duly noticed public hearing
held September 23, 2009, reviewed, considered, and recommended that Sections 18.08.040 (the
Zoning Map), 18.30(C), and 18.18.060(f) of the Palo Alto Municipal Code be amended to delete
Sections 18.30(C).040 and 18.18.060(f)(1), and to rezone properties as listed in Exhibit 1 and
shown on Exhibit 2.
(b)
The Council, held a public hearing on November 9, 2009, and considered the
recommendation by staff and the Planning and Transportation Commission.
(c)
The proposed ordinance is in the public interest and will promote the public
health, safety and welfare, as hereinafter set forth, and is consistent with the City's
Comprehensive Plan.
SECTION 2. Section 18.08.040 of the Palo Alto Municipal Code, the "Zoning
Map," is hereby amended by adding the Ground Floor (GF) combining district to the properties
listed on Exhibit 1.
SECTION 3. Section 18.30(C) (Ground Floor (GF) Combining District Regulations)
of the Palo Alto Municipal Code is hereby amended to delete Section 18.30(C).040 (Use
Exemptions).
SECTION 4. Section 18.18.060(f) (Restrictions on Office Uses) of the Palo Alto
Municipal Code is hereby amended to delete Section 18.18.060(f)(l) and rename Section
18. 18.060(f)(2) to 18. 18.060(f)(1 ).
SECTION 5. This action is categorically exempt (per Section 15305 (Class 5) of the
CEQA Guidelines) from the provisions of CEQA as they comprise minor alterations to land use
limitations and can be seen to have no significant environmental impacts.
II
II
1
091103 syn 0120418
NOTE YET APPROVED
SECTION 6. This ordinance shall be effective on the thirty-first day after the date of
its adoption.
INTRODUCED:
PASSED:
AYES:
NOES:
ABSTENTIONS:
ABSENT:
ATTEST:
APPROVED:
City Clerk
Mayor
APPROVED AS TO FORM:
City Manager
Assistant City Attorney
Director of Planning and
Community Environment
2
091027 syn 0120418
EXHIBIT 1
The following properties will be added to the Ground Floor (GF) Combining District:
200-228 Hamilton Avenue
APN 120-27-008
230-238 Hamilton Avenue - APN 120-27-009
240-248 Hamilton Avenue
APN 120-27-010
412 Emerson Street APN 120-26-106
EXHIBIT 2
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ATTACHMENT 8
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Legend
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c::J CD-C (P) Zone
ALMA STREET
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This map is a product of the
City of Palo Alto GIS
The
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Downtown Zoning with
Ground Floor Retail
Protections
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The CIIy of Palo AIIo assumes no rSSPDnsiblll1y for any errors @1989102009 CIIy of Palo Alto
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ATTACHMENT C
18.18.060
(d)
Development Standards
Hotel Regulations
(1) Hotels, where they are a permitted use and generate transient occupancy tax (TOT),
may develop to a maximum FAR of2.0: 1.
(2) Hotels may include residential condominium use, subject to:
(A) No more than 25% of the floor area shall be devoted to condominium use;
(B) No more than 25%) of the total number of lodging units shall be devoted to
condominium use; and
(C) A minimum FAR of 1.0 shall be provided for the hotel/condominium building( s).
(e)
Exempt Floor Area
When a building is being expanded, square footage which, in the judgement of the chief
building officia~ does not increase the usable floor area, and is either necessary to conform
the building to Title 24 of the California Code of Regulations, regarding handicapped access,
or is necessary to implement the historic rehabilitation of the building, shall not be counted as
floor area.
(f)
Restrictions on Office Uses
(1 ) In all CD subdistricts, no medical, professiona~ or general business office shall be
located on the ground floor, except such offices which:
(A) Have been in continuously in existence in that space since March 19,2001, and, as of
such date, were neither non-conforming nor in the process ofbeing amortized
pursuant to Chapter 18.30(D;
(B) Occupy a space that was not occupied by housing, retail services, eating and drinking
services, personal services, or automotive service on March 19,2001 or thereafter;
(C) Occupy a space that was vacant on March 19,2001;
(D) Are located in new or remodeled ground floor areas built on or after March 19, 2001
if the ground floor area devoted to housing, retail services, eating and drinking
services, personal services, and automobile services does not decrease; or
(E) Are on a site located in an area subject to a Specific Plan or Coordinated Area Plan,
which specifically allows for such ground floor medical, professional, or general
business offices.
(2) In the CD-S and CD-N subdistricts, the following requirements shall apply to office
uses:
(A) No new gross square footage of a medical, professional, general business, or
administrative office use shall be allowed, once the gross square footage of such
office uses, or any combination of such uses, on a site has reached 5,000 square feet.
, (B) No conversion of gross square footage from any other use to a medical, professional,
general business, or administrative office use shall be allowed once the gross square
footage of such office uses, or any combination of such uses, on a site has reached
5,000 square feet.
Ch. 18.18 - Page 9
(Supp. No 13
10/1/2007)
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ATTACHMENT 0
Conditional Uses
18.30(C).030
Chapter 18.30(C)
GROUND FLOOR (GF) COMBINING DISTRICT REGULATIONS
Sections:
18.30(C).010
18.30(C).020
18.30(C).030
18.30(C).040
Specific Purpose
Permitted Uses
Conditional Uses
Use Exception
18.30(C).010 Specific Purpose
The ground floor combining district is intended to modifY the uses allowed in the CD commercial
downtown district and subdistricts to allow only retail, eating and drinking and other service-oriented
commercial development uses on the ground floor. For the purposes of this chapter, "ground floor"
means the first floor which is above grade. Where the ground floor combining district is combined
with the CD district, the regulations established by this chapter shall apply in lieu of the uses
normally allowed in the CD district. Except for the regulations relating to uses set forth in this
chapter, all other regulations shall be those of the applicable underlying CD district.
(Ord. 4098 § 2 (part), 1992)
18.30(C).020 Permitted Uses
(a)
The following uses shall be permitted in the OF combining district:
(1) Eating and drinking;
(2)
Hotels;
(3) Personal services;
(4) Retail services;
(5) Theaters;
(6) Travel agencies;
(7) Entrance, lobby or reception areas serving nonground floor uses;
(8) All other uses permitted in the underlying district, provided such uses are not on the
ground floor.
(b) Notwithstanding subsection (a), not more than twenty-five percent of the ground floor
area not fronting on a street may be occupied by a use permitted in the applicable
underlying CD district.
(Ord. 4098 § 2 (part), 1992)
18.30(C).030 Conditional Uses
(a)
The following uses may be conditionally allowed on the ground floor in the OF ground
floor combining district, subject to issuance of a conditional use permit in accord with
Ch. 18.30 - Page 7
(Supp. No 13 -10/1I2007)
18.30(C).040
Use Exception
Chapter 18.76 (permits and Approvals) and with the additional finding required by
subsection (b):
(1) Busmess or trade school;
(2) Commercial recreation;
(3) Day care;
(4) Financial services, except drive in services;
(5) General business service;
(6) All other uses conditionally permitted in the applicable underlying CD district,
provided such uses are not on the ground floor.
(b) The director may grant a conditional use permit under this section only ifhe or she
makes the following finding in addition to the findings required by Chapter 18.76
(permits and Approvals): The location, access or design of the ground floor space of the
existing building housing the proposed use, creates exceptional or extraordinary
circumstances or conditions applicable to the property involved that do not apply
generally to property in the same district.
(c) Any use conditionally permitted pursuant to this section shall be effective only during
the existence of the building that created the exceptional circumstance upon which the
finding set forth in subsection (b) was made.
(Ord. 4826 §§ 94, 95,2004: Ord. 4098 § 2 (part), 1992)
18.30(C).040 Use Exception
(a) Application may be made to the director of planning and community environment for
an exception to the otherwise permitted or conditionally permitted ground floor uses, to
allow a use permitted in the applicable underlying CD district, if the following
conditions are met:
(1) The initial application for the exception is made when the vacancy rate for ground
floor properties within the GF combining district, as determined by city survey, is
five percent (5%) or greater. (The city shall conduct the vacancy rate survey in
September of each year.); and
(2) The applicant can demonstrate that the ground floor space for which the application is
being made has been vacant and available for occupancy six months or more at the
time of the application.
(b) Any exception granted pursuant to this section shall be for a specific use, and shall be
effective for five years, or less time if requested by the applicant.
(Ord. 4098 § 2 (part), 1992)
{Supp. No 13 - 10/1/2007
Ch. 18.30 - Page 8
ATTACHMENT E
PLANNING & TRANSPORTATION
DIVISION
STAFF REPORT
TO:
PLANNING & TRANSPORTATION COMMISSION
FROM:
Jennifer Cutler
Planner
AGENDA DATE:
September 23, 2009
SlTBJECT:
Amendment of the Palo Alto Municipal Code Chapter 18.0S.040 (the
Zoning Map), Chapter 18.30(C) (the Ground Floor (GF) Combining
District), and Chapter 18.18 (the Downtown Commercial Community
(CD-C) Zone District) to Modify Restrictions on Ground Floor Uses in the
Downtown
DEPARTMENT:
Planning and
RECOMMENDATION:
Staff recommends that the Planning and Transportation Commission (P&TC) recommend
amendment of the Zoning Map and Text Changes to the Palo Alto Municipal Code Chapter
IS.30(C) (Ground Floor (GF) Combining District) and Palo Alto Municipal Code Chapter IS.18
(Downtown Commercial Community (CD-C) District) to City Council for the purpose of
modifying the restrictions on ground floor uses, as set forth in Attachment A with attached
Exhibits.
PURPOSE AND BACKGROUND:
The purpose of these changes to the Zoning Ordinance is to address concerns about the loss of
revenue generating retail and potential degradation of downtown vitality from an increase in
ground floor office space in the downtown core and due to dispersal of retail and personal
service uses into the area outside the core.
The changes to the Zoning Ordinance were initiated by the P&TC on July 22,2009, with the
request that staff conduct outreach meetings with owners of property and businesses in the
downtown core to get feedback on the potential code changes. City staff attended meetings of the
Chamber of Commerce and the Downtown Business Improvement District on August 5 th and
12th, respectively. Following those meetings, staff sent out notice cards to downtown property
and business owners for two meetings held at City Hall on August ISth and 25 th , A follow-up
meeting with interested parties to discuss potential map changes was held on September 2nd ,
City of Palo Alto
Page 1
Ground Floor (GF) Combining District
The regulations contained in the Ground Floor (GF) Combining District were initially
implemented in 1986 with the creation of the CD zoning district as a subdistrict to that district.
The GF combining district restricts ground floor uses, unless a conditional use permit is granted,
to the following:
(1) Eating and drinking;
(2) Hotels;
(3) Personal services;
(4) Retail services;
(5) Theaters;
(6) Travel agencies;
(7) Entrance, lobby or reception areas serving on ground floor uses.
The only significant changes since the original 1986 code are the inclusion of conditional uses
which include commercial recreation, daycare, financial services, and others (see Attachment C
for the full list). This combining district also contains a section allowing for a request for a use
exception when the vacancy rate for ground floor properties within the GF combining district is
five percent (5%) or greater, and the ground floor space has been vacant and available for six
months or more.
Commercial Downtown (CD) District
The restrictions on ground floor use in commercial districts throughout the City were
implemented at a City Council Meeting on November 19, 2001. These restrictions bar medical,
professional, or general business offices located on the ground floor except in certain situations,
including existing offices, and locations that have not been occupied by housing, retail,
restaurants, personal services or automotive services since March 19,2001 (Attachment B).
These restrictions are different from the GF restrictions, in that they protect only existing ground
floor retail by preventing ground floor office if there is or has been retail (or one of the uses
listed above) in that location on or since March 19, 2001. These restrictions do not include a
provision allowing the Director to issue Use Exceptions upon a determination that a specified
vacancy rate has been exceeded, as is found in the GF district.
Vacancy Rate
Current estimates place the vacancy rate for ground floor spaces in the downtown core Ground
Floor (GF) Combining District at approximately 10%. The formal calculation of the vacancy rate
in the downtown core is conducted each September and reported to City Council shortly
thereafter. It is calculated based on the square footage of ground floor space vacant at that time.
This report outlines proposed changes to these existing zoning designations and the zoning map
developed by staff, based on input from downtown property and business owners, to help address
potential problems related to high vacancy rates.
DISCUSSION:
The predominate zoning classifications in the downtown area are CD-C(GF)(P) on both sides of
University Avenue and north of Hamilton A venue between Alma and Waverley Streets, and CDC(P) located on Lytton A venue between Alma & Kipling Streets to Forest Avenue between
City of Palo Alto
Page 2
Emerson & Waverley Streets. Attachment A shows a map of these zones. Most of the unmarked
properties in the downtown core area are either Planned Community (PC) zones or Public
Facility (PF) zones (Attachment B).
The CD-C regulations, as well as those of the other commercial districts within the City, include
restrictions on ground floor office uses. These restrictions focus mostly on protecting existing
housing, retail, restaurants, personal services and automotive services in the ground floor space.
These regulations do not provide any opportunity for sites with these uses to revert to office
under any conditions but they do not prevent office from continuing where it currently exists.
The intent of the OF restrictions is to modify the uses allowed in the CD commercial downtown
district and subdistricts to allow only retail, eating and drinking, and other service-oriented
commercial development uses on the ground floor. The OF code, Palo Alto Municipal Code
(PAMC) Section 18.30(C).010, lists specific uses allowed on the ground floor, but allows for a
Use Exception when the vacancy rate for ground floor properties within the OF combining
district is five percent (5%) or greater and the applicant can show that the location has been
vacant and available for six months or more. There is no provision for a Use Exception in the
similar restrictions existing within the CD district (PAMC Section 18.18.060(f)).
Business Outreach:
Two meetings with downtown property and business owners were held at City Hall on August
18th and 25 th to discuss four key questions. These meetings had an attendance of approximately
15-20 people each. A follow-up meeting with interested parties to discuss the specific map
changes was held on September 2nd• The four questions addressed in these discussions were as
follows:
1. Should the vacancy rate required for a use exception request to allow ground floor
office in the Oround Floor (OF) combining district be increased (from its current 50/0),
or should the use exception process be removed completely?
2. Should the restrictions in the Commercial Downtown Community (CD-C) district
outside of the OF zone be revised to allow office space where retail currently exists?
3. Should the OF district boundaries be revised? If so, what areas should be added to the
OF district, and which should be removed?
4. Are there certain uses that should be limited in quantity in the downtown core?
Restaurants and financial institutions are two that have been discussed. If so, what
limits might be set?
The meetings revealed a high level of consensus between those who attended the meetings, as
well as those who called in with comments. Attendees voiced strong support for removal of the
use exception from the code (Item 1) so as to protect what was felt to be the essential continuity
of retail in the downtown core. Item 2, the increased flexibility in ground floor uses outside of
the OF Combining District, also received significant support, as long as the map boundaries were
adjusted to include certain valuable retail areas, and provide relief for some OF-zoned sites that
City of Palo Alto
Page 3
are not desirable for retail (Item 3). Alma Street was called out as a particularly difficult location
for retail, but the vitality of the Emerson Street retail corridor was discussed as a potential area
for added protection. Attendees agreed that financial institutions that act like offices were
inappropriate on the ground floor of buildings in the core where the continuity of the pedestrian
environment is so important, but acknowledged that could be addressed through existing
conditional use permit process. There was strong opposition to the idea of restricting other uses,
such as restaurants, which support the vitality of downtown and are generally limited and
controlled by economic factors.
Staff Recommended Changes to Ground Floor (GF) Combining District Regulations:
Staff recommends removal ofPAMC Section 18.30(C).040 so that there will no longer be the
option for a Use Exception based on vacancy rate.
Staff Recommended Changes to Downtown Comnlercial (CD-C) District Regulations:
Staff recommends removal of PAMC Section 18.18.060(f)(1) so that loss of flexibility of ground
floor uses in the downtown core covered by the OF Combining District will be balanced by an
increase in flexibility for ground floor uses in the periphery of the downtown.
Staff Recommended Revisions of Zoning Map:
Staff recommends revisions to PAMC Section 18.08.040 (the Zoning Map) to remove from and
add specific properties to the OF Combining District. The list of properties is provided as
Exhibits 1 and 2 of Attachment A. The key changes and other considerations included:
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Removal of OF protection from properties along Alma Street, and portions of High Street
(near Hamilton Avenue).
Removal of OF protection from properties along the circle ramps connecting University
A venue and Alma Street.
Added OF protections to the existing retail on the south side of the strongest block of
retail on Hamilton Avenue (the 200 block between Emerson Street and Ramona Street)
and to the Aquarius Theater and the two restaurant sites imnlediately to the north on
Emerson.
Three miscellaneous non-retail parcels along Kipling and Cowper north of University are
also proposed to be removed from the OF zoning.
No changes to University Avenue east of Cowper Street.
No changes to Bryant between University A venue and Hamilton Avenue.
Staff believes-that these changes reflect the areas of downtown that are most valuable as retail
assets and provide a logical retail core that is not just University Avenue, but the "t" created by
University A venue and Emerson Street as it connects to the Aquarius Theatre in one direction
and the SOFA district in the other.
Discussion of the properties along Emerson Street between Hamilton Avenue and Forest Avenue
resulted in the conclusion that those properties are not as strong candidates for the OF combining
district as they are separated from the downtown core retail by Casa Olga on the comer of
Hamilton Avenue and Emerson Street and likely to stay retail without additional restrictions. The
retail emphasis is also focused only on one side (west) of Emerson Street.
City of Palo Alto
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Staff Recommended Limits on Businesses of Concern:
Staff recommends no changes to the limits on specific businesses of concern. This
recoriunendation in regards to financial institutions is based on the finding that financial
institutions are currently restricted by a requirement for a Conditional Use Permit within the GF
Combining District, and can therefore be required to provide an active pedestrian environment
on the street prior to granting of any permit. In regards to a concern expressed by the P&TC
about the number of restaurants, the public feedback received strongly supported the idea that
economic forces would provide sufficient controls, and that the additional process and expense
that would be imposed on potential new restaurants in order to limit their numbers would have a
significant negative impact on the vitality of downtown.
Planning & Transportation Commission Comments at Initiation:
Minutes of the meeting to initiate these changes to the Municipal Code are included as
Attachment E of this report. Staff has prepared a table of the comments received at that meeting
and responses as Attachment F.
In addition to Policies that support the retail vitality of the University AvenueIDowntown area,
the Palo Alto Comprehensive Plan specifically directs evaluation of the ground floor retail
retail requirement, in the University AvenueIDowntown area. Keep the Planning
This action is categorically exempt (per Section 15305 (Class 5) of the CEQA Guidelines) from
the provisions of CEQA as they comprise minor alterations to land use limitations and can be
seen to have no significant environmental impacts.
ATTACHMENTS:
A. Draft Ordinance with Exhibits (Exhibits 1 and 2, property lists, and Exhibit 3, map showing
proposed revised locations of GF combining district)
B. Map showing existing location ofCD-C zoning and GF combining
C. Ground floor use restrictions for CD-C zoning district (PAMC Section 18.18.060(f»
D. GF zoning district regulations (pAMC Section 18.30(C).060)
E. P&TC Meeting Minutes, July 22,2009.
F. Table showing PTC's Concerns and Staff's Responses
Prepared by:
Jennifer Cutler, Planner
Reviewed by:
Amy French, Current Planning Manager
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DepartmentiDivision Head Approval: __
Curtis Williams, Director
City of Palo Alto
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ATTACHMENT F
PLANNING & TRANSPORTATION
DIVISION
STAFF REPORT
TO:
PLANNING & TRANSPORTATION COMMISSION
FROM:
Jennifer Cutler
Planner
AGENDA DATE:
.July 22, 2009
SUBJECT:
Initiation of Zoning Map and Text Changes to Palo Alto Municipal Code
Chapter 18.30(C) (the Ground Floor (GF) Combining District) and Palo
Alto Municipal Code Chapter 18.18 (Downtown Commercial Community
(CD-C) Zone District) to Modify Restrictions on Ground Floor Uses
DEPARTMENT:
Planning and
RECOMMENDATION:
Staff recommends that the Planning and Transportation Commission (P&TC) initiate changes to
the Zoning Ordinance to modify the restrictions on ground floor uses in Palo Alto Municipal
Code Chapter 18.30(C) (the existing Ground Floor (GF) Combining District) and Palo Alto
Municipal Code Chapter 18.18 (Downtown Commercial Community (CD-C) District), and direct
the Director of Planning and Community Environment (Director) to prepare the proposed zoning
ordinance text and potential zone district boundaries.
PURPOSE AND BACKGROUND:
The purpose of these changes to the Zoning Ordinance is to address concerns about the revenue
generating retail and downtown vitality of downtown through increased office uses on ground
floor in the downtown core and due to dispersal of retail and personal service uses.
Ground Floor (GF) Combining District
The regulations contained in the Ground Floor (GF) Combining District were initially
implemented in 1986 with the creation of the CD zoning district as a subsection to that district.
The text of the regulation, which stays essentially intact from the original 1986 regulations, was
converted as a combining district separate from the CD zones in 1992. The only significant
changes since 1986 are the inclusion of conditional uses which include commercial recreation,
daycare, financial services, and others (see Attachment C for full list). This combining district
also contains the use exception wording from the original ground floor section of the CD zone.
City of Palo Alto
Page 1
This section allows for request for a use exception when the vacancy rate for ground floor
properties within the GF combining district is five percent (5%) or greater, and the ground floor
space has been vacant and available for six months or more.
Commercial Downtown (CD) District
The restrictions on ground floor use in commercial districts throughout the City were
implemented at a City Council Meeting on November 19, 2001, in response to a Colleague'S
Memo dated March 15, 2001. These restrictions bar medical, professional, or general business
offices located on the ground floor except in certain situations, including existing offices, and
locations that have not been occupied by housing, retail, restaurants, personal services or
automotive services since March 19, 2001 (Attachment B). These restrictions do not include a
provision allowing the Director to issue Use Exceptions upon a determination that a specified
vacancy rate has been exceeded, as is found in the GF district.
Vacancy Rate
Current estimates place the vacancy rate for ground floor spaces in the downtown core Ground
Floor (GF) Combining District between 10 and 15 %. The formal calculation of the vacancy rate
in the downtown core is conducted each September and is calculated based on the square footage
of ground floor space vacant at that time. With the vacancy rate potentially above the 5%
threshold, there are also concerns that areas on the edge of the CD-C and GF areas may not be
strong retail locations and therefore detract from the vitality of the downtown core. Some
examples include spaces at 265 Lytton, and 530 University.
This report outlines potential changes to these existing zoning designations and the zoning map
to help address potential problems related to high vacancy rates. If the P&TC agrees that this
issue should be addressed, it should initiate the zone change and staff will return with a proposed
ordinance.
DISCUSSION:
The predominate zoning classifications in the downtown area are CD-C( GF)(P) on both sides of
University Ave and north of Hamilton between Alma and Waverley, and CD-C(P) located on
Lytton between Alma & Kipling to Forest between Emerson & Waverley. Attachment A shows a
map of these zones. Most of the unmarked properties in the downtown core area are either
Planned Community (PC) zones or Public Facility (PF) zones (Attachment A).
The CD-C regulations, as well as the other commercial districts within the City, include
restrictions on ground floor office uses. These restrictions focus mostly on protecting housing,
retail, restaurants, personal services and automotive services that exist in the ground floor space.
These regulations do not provide any opportunity for sites with these uses to revert to office
under any conditions.
The intent of the GF restrictions is to modify the uses allowed in the CD commercial downtown
district and subdistricts to allow only retail, eating and drinking, and other service-oriented
commercial development uses on the ground floor. This combining district is primarily used on
properties in the downtown but since 2001, also applies to properties along Middlefield Road in
Midtown. The GF code, Palo Alto Municipal Code (FAMC) Section 18.30(C).010, lists specific
City of Palo Alto
Page 2
uses allowed on the ground floor, but allows for a Use Exception when the vacancy rate for
ground floor properties within the GF combining district is five percent(5%) or greater and the
applicant can show that the location has been vacant and available for six months or more. There
is no provision for a Use Exception in the similar restrictions existing within the CD district
(PAMC Section 18.18.060(1).
Revisions to the CD-C and GF zones that have been suggested for potential discussion include
(but are not restricted to) the following:
1. Increase the vacancy rate (to 15 or 20%) required in the GF combining district
applied to the downtown core before a Use Exception may be considered and issued
by the Director (PAMC 18.30(C).040). This revision to the code would strengthen the
downtown retail core by preventing significant requests for use exceptions when the
City is in an economic downturn.
2. Allow office on the ground floor of buildings within the CD-C district outside of the
GF downtown core, regardless of their previous use. This revision to the code would
encourage property owners to allow retail without excluding the possibility of
converting back to office at some future date. This revision to the code would
encourage concentration of retail use to those locations covered by the GF combining
district. Alternatively, this flexibility could be limited to certain sites only.
3. Revise the boundary of the downtown GF combining district to expand or contract
the boundary to better reflect the current downtown core, and to Include the most
viable CD-C retail areas.
4. Differentiating between retail use and restaurant use. This might be a method for
limiting the number of restaurants within the downtown core, to maintain and
encourage a greater variety of retail use. Since the City no longer limits the number
of downtown restaurants serving alcohol on a block by block basis, the number of
conversions from retail use to restaurant use in the GF area has increased and that
number could increase further in the future. It is generally true for Palo Alto's
downtown core that once a commercial space has converted to restaurant use, with all
of the associated tenant improvements, it is less likely convert back to retail use.
Business Outreach:
On July 8,2009, city staffmet with developers, owners and managers of downtown properties,
and representatives from the Downtown Business Improvement District and Chamber of
Commerce, to solicit their reactions to the proposals listed above, as well as to receive any
recommendations they might have on the subject. The comments received at that meeting
included the following:
1. It is a misconception that more retail floor area means more sales tax, as the level of
retail quality can decline.
2. A certain amount of office space is needed because office tenants support the retail
and make the downtown active during the daytime.
City of Palo Alto
Page 3
3. Restaurants are the anchor tenants for Palo Alto's downtown and extend the active
hours of downtown.
4. Downtown areas not covered by the GF combining district should have more
flexibility of uses including office, similar to SOFA II restrictions.
5. Dentists and walk-in service banks are also good uses in a downtown because their
clients also support nearby retail shops.
6. Removal of the use exception provision contingent upon a 5% vacancy rate in GF
district was generally supported, but support was not unanimous.
7. Removal of GF combining district from certain properties along Alma Street, and
'from properties on University Avenue north of Cowper Street.
In addition to Policies that support the retail vitality of the University AvenuelDowntown area,
the Palo Alto Conlprehensive Plan specifically directs evaluation of the ground floor retail
retail requirement, in the University AvenuelDowntown area. Keep the Planning
This action (initiation of zoning changes) by the Planning and Transportation Commission is not
considered a project under the California Environmental Quality Act (CEQA). Any subsequent
zoning map amendment would be subject to review under CEQA.
ATTACHMENTS:
A. Map showing location of CD-C zoning and GF overlay
B. Ground floor use restrictions for CD-C zoning district (PAMC Section 18.18.060(f))
C. GF zoning district regulations (p AMC Section 18.30(C).060)
D. Commercial Downtown (CD) Monitoring Report CMR, May 18,2009.
Prepared by:
Jennifer Cutler, Planner
Reviewed by:
Amy French, Current Planning Manager
Q~ E.Z. .: . . . . . .,;.~_UJ.-;. . . ;=-. ;:om~ L_~.w:;." ': . .-~:- _ ____
Department/Division Head Approval: __
Curtis Williams, Interim Planning Director
City of Palo Alto
Page 4
ATTACHMENT G
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Planning and Transportation Commission
Verbatint Minutes
September 23, 2009
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EXCERPT
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Ground Floor Retail Vitality and Protection Ordinance: Review and recommendation to
city Council to amend the Zoning Map and Text of Palo Alto Municipal Code Chapter
18.30(C) (Ground Floor (GF) Combining District) and Palo Alto Municipal Code Chapter
18.18 (Downtown Commercial Community (CD-C) Zone District) to Modify Restrictions
on Ground Floor Uses.
Ms. Jennifer Cutler, Planner: Yes. Good evening Commissioners. This item is a City initiated
action. In the Staff Report for this item we have provided a draft ordinance, which includes
changes to both the CD-C zoning district and the GF Combining District, as well as the map
where these zones apply.
These changes are recommended by Staff based on extensive research and public outreach since
our last meeting on this item when it was initiated. The public outreach included attending
meetings of the Chamber of Commerce, the Downtown Business Improvement District, as well
as three separate meetings at City Hall to which property and business owners in the CD-C and
GF Districts were invited by custom notice cards that were sent to all listed property owners and
business owners. The intent of these recommended changes are to modify the ground floor use
rules in the Downtown, to enhance and protect the vitality of the Downtown core.
The existing GF District covers the core of Downtown, which you can see in orange on the map
up above here. In these code sections there is a list of seven permitted uses and five
conditionally permitted uses on the ground floor level. None of these uses are office. This
district also has a provision in it that allows a use exception when the City's calculated vacancy
rate of the ground floor area in this Ground Floor District grows above five percent. The current
estimate is approximately ten percent, though the official count for 2009 has not yet been
completed. So the previous count of 4.21 percent still stands. So at this time use exceptions are
not currently available.
The CD-C Zone covers all of Downtown and is shown in yellow where it is not combined with
the GF Combining District. This district has a greater number of allowed uses including office,
but there is a section of this code, which prevents office on the ground floor if the space has been
occupied by housing, retail services, restaurants, personal services, or automotive services since
March 2001. This protects existing retail but Staffs outreach has told us that it also prevents
some cautious property owners from taking a chance on retail if there is a chance that they might
want to switch back to office in the future. The fact that the CD-C District does not have
flexibility for ground floor uses once it has been retail also has the effect of spreading the
Downtown retail thin rather than allowing it to concentrate in the core orange section of the map
for the Downtown.
Staff s recommendation included in the Staff Report and draft ordinance are based on comments
fron1 the Commission at the initiation of this zone change in July and the public outreach
meetings. The recommendations include, first to strengthen the ground floor retail protections in
the GF core by removing the provisions for the use exception and vacancy rate calculation.
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Second, to balance this increased restriction by loosening the restrictions on ground floor uses in
the periphery of Downtown, in the areas that are yellow covered by the CD-C District but not the
GF. Three, revisions to the map so that the GF District is adjusted to include some areas that
should continue to have protection on ground floor uses but remove it from those areas that are
not part of that essential Downtown core.
The public outreach also involved a discussion of possible limits on restaurants and other uses of
concern. The public feedback that was received strongly supported the idea that economic
factors would provide sufficient controls and that additional process and expense that would be
imposed on potential new restaurants in order to limit their numbers would have a significant
negative effect on the vitality of Downtown.
The next steps in this process will include additional outreach and then review by the City
Council. We expect the additional outreach will include sending additional custom notice cards
to all property and business owners within the CD-C and GF Districts as well as making specific
calls to the owners of those properties who are proposed to be specifically added to or removed
from the GF District.
Several questions were received by Staff from the Commissioners and responses have been
provided at places. Staff is available to answer any additional questions. Thank you.
Chair Garber: Commissioners, we will go directly to public comments. If you would I would
like you to hold any questions of those members of the public that may be speaking but we will
leave the public comment period open so that if we have questions of them when it comes back
to us for questions and comment we can ask people to approach and ask them directly at that
time. After we get through the public comments my proposal here is that we give each of us five
minutes to ask questions and/or comments so we can get through one row of comments. Then
potentially I would suggest that we do some straw polls querying the Commissioners specifically
on the recommendations by Staff and then we can open it up to further discussion. Ideally we
would get through this item in about an hour and a half or so under that plan. Is that acceptable?
I am seeing general nods of heads. Okay.
Let us invite the public to come and speak. We have three cards. The first is Jim Thoits
followed by Chop Keenan. You will have three minutes.
Mr. Jim Thoits, Palo Alto: Thank you very much. I am with Thoits Brothers. First of all I
would like to thank Staff and Curtis for the outreach to the business community and the property
owners on this process. We have attended the meetings and had a very good session and I
commend them for their work on this.
We have added some properties into the GF zone and we feel we have a good relationship with
what is being presented. There is one exception I would like to address and that is the property
at 285 Hamilton. We built this in 1969 as Thoits Brothers. It was designed around an office "Use.
Originally Great Western was in there for quite a few years if you remember. They left to move
across to 300 Hamilton. When they moved there Cornish & Carey occupied that space and was a
realty office for some time. When Cornish & Carey vacated your own developmental center
showed interest in it and they have been there since.
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We feel that the configuration of the building lends itself to an office use. It has a deep eave
setback. The retail accessibility and visibility is limited at that building. The use of the building
since inception has been office. We have enjoyed the office community there. I think it brings
vitality to the comer in its use. The use as a bank, the Cornish & Carey office, and now your
Development Center is an area that does see vitality. It sees a lot of activity back and forth. So
we feel that we would like to exclude this one property from the GF zone. I would like the
Commission to give this some consideration. Thank you very much for that. If there are any
questions I can answer now I can do that.
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Chair Garber: There ~s a distinct possibility that you may be asked questions once we get
through the rest of the pUblic. Thank you. Chop Keenan followed by Faith Bell.
Mr. Chop Keenan, Palo Alto: Good afternoon. Well, I too want to echo Jim on the Staff
outreach on this. It has just been a delight to engage. It has been a lot of fun, a lot of arm
wrestling. There was no fait a complete, here is what we are going to do. It was really to gather
our input in huge contrast to maybe the Measure A output. Sorry, I couldn't help myself
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So I know Jennifer walked every block in town. She had her walking shoes and so did the
people in my office. So we looked at every single property. We want to see the core
strengthened. The safety valve of the vacancy rate has been important, but hasn't been relevant
because it has been pretty vibrant for a long time. That vacancy rate is well in excess often
percent. There are spaces that are paying rent but that are vacant such as the old Magnolia's.
My guess is this is well north of 15 percent right now.
The other point I want to make is that these are symbiotic uses, office and retail. Those office
workers are customers so it is important that it be viewed that way and not as something that is
mutually exclusive.
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I own the Aquarius Theater. It is one of those that is being proposed for GF on Emerson. I don't
have a big problem with it. I have turned down a lot of other alternatives for that property
because I just like to have the theater Downtown. I think it brings some vibrancy. Although
theaters don't pay a lot of rent it adds to our other holdings and so I would say that it is a little
deep, and I am not going to worry about it. Ifwe want to do something different there we will
come forward and talk about it then but it is way too deep to be all retail. Maybe the first 60 feet
would be more appropriate.
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The ability to flip in and out of office in the yellow CD-C zone is essential. It is in my opinion
the quid pro quo here. We do not, when we have an office vacancy, even consider retail because
it is a one-way street. Once it goes to retail you can't flip back to office. The market has a funny
way of figuring these things out. Retail buildings, we get retail users and so I would encourage
you that that is a critical part of our endorsement of this densification of the GF zone. Thank
you.
Chair Garber: Thank you. Faith Bell, our last speaker.
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Ms. Faith Bell, Bell's Books, Palo Alto: Hello once again. I would just like to lend my support
to the idea of the ground floor retail being extended along Emerson Street. I think that is
historically a retail district and has grown a lot in that way recently. I am distressed to think
about the circle at the end of University Avenue not being retail. I am also distressed to think
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. about High Street not staying with a retail orientation. I think that to exclude that end of town
from a retail requirement will deaden it. I think that traditionally and historically it has been
retail. My father had a business going on the circle in 1935, and I would like to see that end of
town stay vibrant. I think that once you let it all revert to office spaces that won't happen.
I would also like to make a quick comment about the process here. While there are many people
in the development community who I respect I am somewhat concerned that it seems as if they
are the people who are primarily asked to give input to this process. I would have hoped that
there were some kinds of present legal parameters for determining which buildings count as
more suitable to retail application rather than people whose financial interests are so very strictly
tied to it. I would have thought that the master plan or some such document would have had
some guidelines to that and I would certainly like to see that brought to bear on it. So thank you
for your attention.
Chair Garber: Thank you. Commissioners, let's give ourselves each five minutes to ask
questions andlor make comments. We will get through one round of that and then we will do a
couple of straw polls to find out where the sensitive points are and then try and focus our
remaining discussion on those particular points. Commissioner Holman would you like to go
first?
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Commissioner Holman: Sure, and I won't initially take five nlinutes. One question is a
procedural question. I do see that Susan Barnes, the Economic Development Planner, is here and
I was wondering if she might be asked to sit at the table because I am sure there are going to be
questions.
Chair Garber: Perfectly happy to have your five minutes start now.
Commissioner Holman: Okay. I had asked a question about SOFA II because my recollection,
and I did not have time to look it up, but my recollection of SOFA II is that ground floor retail is
required on the street fronts on Emerson Street. Could Staff give that indication, please?
Ms. Cutler: Yes, there is a specific section of SOFA II for sites on the Homer/Emerson corridor,
which is defined as Homer Avenue between Alma and Ramona, so I believe that is three blocks,
and Emerson Street between Forest Avenue and Channing, which I believe is two blocks that are
under restrictions that are very similar to what the CD-C has at the moment as well. Protection
for ifit has existing retail, eating and drinking, personal service, automotive services now or
since March 19, 2001.
Commissioner Holman: You said between Homer and Addison, right? What were the streets?
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Ms. Cutler: Channing and forest.
Commissioner Holman: Okay. So what consideration was given to connecting those retail
requirements or was that considered?
Mr. Curtis Williams. Planning Director: There was much consideration. I would say that that's
probably the - although I have to say that we didn't focus on the fact that SOFA had that down
there but more the fact that there was retail down there and particularly that this is sort of a
corridor to Whole Foods and that node. So there was a lot of discussion about that. I think
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ultimately the reason it wasn't was it starts to make that GF corridor start to stick out in a
different direction then and it is not sort of clustered together and separated by I guess it is Casa
Olga there too. That is certainly an issue for the Commission to discuss. There is logic to that
kind of connection but again starting to extend fingers of the GF down seemed somewhat
contrary to trying to sort of focus on it and compress it between Lytton and Hamilton. So
certainly we heard opinions on both sides of that issue and they both have some valid points. I
think you can probably ask for some of the folks out here to comment about their perspectives
because you will get both from them.
Commissioner Holman: I had hear, and I only heard this, I am not trying to start a rumor it is
just something I heard, that Casa Olga was going to be redeveloped, the property is going to be
redeveloped. Has Staffheard anything about that?
Mr. Williams: I have heard that from time to time but there has not been any kind of
presentation to us about any change on that site, not that I am aware of.
Commissioner Holman: A question for Susan Barnes. When I look at the circle and removing
the ground floor requirements there what pops into my mind is the situation that we have at
California Avenue where the train station is. It is not too dissimilar to the situation that we have
here. One of the things that are really problematic about California Avenue is leaving that train
station there are just dead walls there. While this wouldn't be dead walls I would like your
feedback on the impact of people again coming from the Stanford side, people coming from the
train station. They are coming along and they are not going to see the interface with retail and
services there but potentially offices. Could you comment on that and compare it to California
Avenue if you might?
Ms. Susan Barnes, Economic ResourceslRedevelopment Program Manager: We talked quite a
bit about that and what we were hearing from a number of the businesses and property owners
there is that the configuration of the buildings specifically on the south side there was not very
conducive to retail uses, and what was happening was people were walking directly from the
train station and were not stopping at those businesses. There had been a lot of turnover and that
type of thing.
I actually kind of like that circle and I kind of often gave the position that if we really did have a
walkable comnlunity that those places were accessible and the parking wasn't as difficult and
things like that. But really what we heard from property owners and a number of businesses was
they didn't think it was very conducive, especially in those first few spaces there.
I think it is a little bit different than the California Avenue area just by virtue of the types of
businesses that are there. The Plantation Cafe tried very, very hard to make it there and had a lot
of difficulty. So I don't know. I think it is one of those areas that we had kind of want to .....
Mr. Williams: If I could add, I think also one of the difficulties was that isn't, unlike the other
streets here where you are up on a flat surface and it is easily walkable and connectable, you
have the vehicular traffic coming under there and up, and just is kind of a mess and sort of
difficult to anticipate particularly a highly viable retail space but celiainly there have been retail
spaces there. They have not been too long lasting but they continue to pop up there. So like
Susan said, it is another one of those areas that there was a lot of discussion about.
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Commissioner Holman: I will pass now of course because of the five nlinutes but I am going to
have some follow-ups to that line of questioning.
Chair Garber: Sure. Commissioners, someone else? Commissioner Fineberg.
Commissioner Fineberg: I would like to follow up on Commissioner Holman's question about
Casa Olga. If one is to believe what one sees in the newspaper the intermediate care facility that
located at that site is being closed. The folks that called that home are moving out in a very short
period of time, and I believe there was a quote from Jim Baer talking about working with the
developers to determine an advantageous way to redevelop the property that would benefit the
public. Again, I understand that until there is something concrete they are not going to come to
Staff but that plants a seed in my mind that more than any time in the last 30 years that property
is likely to be redeveloped. So I don't necessarily know what the answers are for that block on
Emerson but I think we ought to consider what happens with Emerson with the assumption that
there is high likelihood that in a short period of tinle it will be developed. We need to zone for
what we want, the community, what gets built will be what we allow. So the community needs
to have some discussion and thought as to what should be there when it is, if it is indeed
redeveloped. Again, I am going from what I read in the press, it is likely to be redeveloped more
so than in the past. That's it.
Mr. Williams: Excuse me, Chair Garber. First of all, Ijust want to let you all know, I apologize,
but I need to go next door to the Council Candidate orientation. I will probably be running back
and forth during this meeting. So if you see me get up and leave I will probably be back.
I did want to point out that one of the things we want to stress here is that just because something
or a site is in this yellow area, which wouldn't have the same protection as before, does not nlean
that it would not be retail. There is nothing that says that it now has to be office. There are lots
of areas around the perimeter of this that either developed as retail before we had these
regulations or even outside the yellow and have developed as retail. So it is just a matter of is
there flexibility to go in and out. Maybe Casa Olga is a location that it is a criticallynchpin and
you feel like that needs to have that protection. I just want to be sure we are not assuming that
everything in yellow is automatically office just because it doesn't have that same level of
protection.
Chair Garber: Thank you. I failed to inform the Commission that the Planning Director is going
to be flipping between meetings. The other thing to note is that both the Planning Director and
the City Attorney will have to leave early this evening in preparation of arriving here very early
tomorrow with the anticipated furlough issue. So take advantage of them while we have them.
Commissioner Fineberg, did you have a follow up? Okay. Commissioner Tuma and then
Keller.
Vice-Chair Tuma: I want to delve into a little bit about the input from the community and
various components of the community because I think this is a situation where obviously Staff
highly valued the input from the business community. They are probably better well situated
than Staff or the Planning Commission for that matter to really understand the nuances of the
business climate. So I am very inclined to rely on that information as well but I want to make
sure that we have an adequate cross-section of different players who have had not only the
opportunity which was through the invitations that were extended by Staff but who actually did
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come in and talk to you folks. So there are a couple of specific areas in the Staff Report where it
sounds like you are relying fairly heavily on that input.
One of those has to do with whether or not there should be any limits put on restaurants. So that
is by way of example, but I think it would be helpful for us and the public to understand, and
there was one comment made by one of our speakers as to who all was involved in these
discussions, not only who was invited but who was actually involved and formed the basis for
some of the recommendations that we have here. I did see the list that was provided in response
to Commissioner Martinez's question but that didn't really sort of identify for me on the
particular issues that were relying on this input, who were the players that were given that input.
So if you could give us a little bit more background on that that would be great.
Ms. Cutler: One of the other attachments that I included with our responses to Commissioner
Martinez's questions was the list of questions and kind of the outline we provided at each of
these meetings. We started with a meeting that was mostly property owners. The second
meeting we had property owners and business owners were both invited. We held it here. That
meeting was really a useful because we did have a good mix, a number of different business
owners or managers as well as property owners. Also in addition to that Curtis and Susan
attended the Downtown Business Improvement District meeting, the Chamber of Commerce, so
we got some more feelers out there to the business owners. We covered all of these topics as
best we could in those discussions with all of them.
Vice-Chair Tuma: I know sometimes with outreach we ask for participation and we don't get it,
or we get it but it only comes from sort of one perspective or a couple of perspectives. Do you
feel that through the discussions that you have had that the various different perspectives are all
reflected in the recommendations that you have made or were some of the recommendations that
you have made in the absence of input from certain sectors?
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Ms. Cutler: From the diversity of people that we had I feel that we did have representatives of
small business owners, people who owned just one property, larger property owners. So we had
representatives from each of those sectors. While there are different opinions between the
different people we had good discussion and at the end of these meetings I feel like in general the
consensus was of support of these recommendations.
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Vice-Chair Tuma: Okay. Could you comment on Mr. Thoits' request regarding 285 Hamilton?
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Ms. Cutler: At the moment I believe our recommendation is to keep that block of Bryant in the
GF overlay. While it has some difficulties at the moment with the new development on the
comer of University and Bryant I think it is important to hold onto to trying to keep that a good
strong retail. Removing that comer from the GF might be of concern because it breaks up
potential future continuity but I think part of what he has to say about it not being conducive to
.future retail use because of the design of the building does have some merit as well.
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Vice-Chair Tuma: Okay, but just be clear, we are not changing anything there.
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Ms. Cutler: Correct. Weare not proposing any changes for that site.
Vice-Chair Tuma: Okay.
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Chair Garber: Go ahead.
Ms. Barnes: I think that Bryant Street has been problematic for a while. We have had sonle
concerns about the amount of turnover of businesses on Bryant Street. We also recognize the
fact that with the revitalization of the Walgreen's comer that that street is going to yet change
again. There has been an awful lot of construction there. It has been problematic for those
businesses that have been located there. The reason that we have kind of kept that particular
piece in is for the kind of continuity that Jennifer is talking about. There are a number of small
businesses across the street there and the synergy seenlS to work, but she is right also about, and
Jim is also right about the configuration of the business and it is problematic.
Vice-Chair Tuma: Okay. One last question again related to outreach. For the properties that are
being changed either in or out has Staffhad discussions with every single owner and business
operator of those properties to make sure they understand that this is going on and to get their
feedback on it?
Ms. Cutler: I don't believe that we have had individual discussions with everyone of them. I
believe our goal would be once we have a recommendation from the Planning Commission we
would do outreach to them so they are aware of what that final recommendation from the
Planning Commission is to Council before the Council sees this issue.
Vice-Chair Tunla: Okay, thank you.
Chair Garber: Commissioner Keller and then Lippert.
Commissioner Keller: Thank you. First of all I would assume that there is universal agreement
with respect to eliminating the potential of the use exception, which is the Staff recommended
change to Ground Floor, the first change. I think we will probably see that in the straw vote.
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Secondly, with the second item I hear a concern about the idea of there being two-way - in other
words, right now going to retail is a ratchet. Ifit becomes retail it has to stay retail. I understand
that that is a concern for property owners to go to retail. So firstly I think we don't want to lose
the existing retail that is there and reducing the protection for the existing retail uses if there is
some property that becomes vacant then there might be a desire to make it not retail, and that
would cause some sort of discontinuities in whatever retail exists. So I think there is a desire to
strengthen retail. I agree with the members of the public, the property owners that office uses do
enhance retail, but office uses on second or upper floors enhance retail more than office uses on
the ground floor. So office uses above retail is much more synergistic than office uses down on
the ground floor that cause a breakup of the retail uses and cause the pedestrian flow to be
broken up. An example of that if you will is that with the Wells Fargo Bank at University and
Bryant sort of breaks that up in a way that is not desirable. The Union Bank at Waverley is not
quite as problematic because there is nothing on Waverley that is there that you would really
walk to, but still that one is somewhat problematic. In contrast the American Express office,
which is a financial services office, is really small. It doesn't break things up, it looks like a
retail establishment, and it behaves like an ordinary retail establishment in the sense that people
go there for travel and things like that as opposed to - and even Union Bank is sort of open to the
public while the Wells Fargo is a private bank.
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In terms of flipping in and out of office I think that there are a couple of ideas that we could
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I also want to draw attention to Attachment D, 18.30(C).020. In particular it says permitted uses
and there is a big loophole in terms of letter (a)(7), entrance, lobby or reception areas serving
non-ground floor uses. There are examples of that that work reasonably well, if you look for
example, there is a small lobby area next to the Lululemon Athletica, there is a small lobby area
next to the CVS for example that works reasonably well, it is not intrusive. On the other hand, if
you look at the lobby area that has been put on the University Avenue circle, the circle portion, it
takes up the whole space, and it is much bigger than is needed for a lobby area. So I would
suggest that we constrain the size of the lobby/reception area. In fact by allowing that full floor
lobby area we have essentially de facto broken up that space along the curve. I would like us to
think more carefully before deleting things from the Ground Floor protection particularly if there
is no protection at all about ground floor. If it is completely deregulated that seems to me overly
problematic with that.
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have. One idea is either having a CUP to go into office from retail or to require the existing
retail stay as retail not to relax that, but if new retail then either allow that to go back and forth or
allow a CUP for new retail. So I would like us to consider more flexibility in terms of this than
simply deregulating the non-ground floor rules portion of the CD-C zone.
With respect to Bryant Street I think that the fact that the current building at, I think it is, 285
University sort of sticks out and sort of makes it uncomfortable to walk around the comer on
Bryant Street makes that retail on the logical west side of Bryant hard to get to. One of the
reasons I was in favor some time ago about having the full seven-foot setback would be to
enhance the pedestrian traffic going down Bryant Street. I think that whatever is built there I
would hope that it be done in such a way that it enhances that pedestrian traffic.
Finally, I would like to say thank you for keeping the Aquarius the way it is. I appreciate that
and I am sure that a lot of other people do.
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Chair Garber: Commissioner Lippert followed by Commissioner Martinez, and myself.
Commissioner Lippert: I have several questions and then I would like to make a couple of
statements. Looking at the map here I would like to follow up on Commissioner Holman's line
of questioning with regard to the areas around University circle that are going to be taken out of
the GF District. With the construction that is going on there isn't it a little premature to be
looking at that and saying we don't think it is going to function as a retail space? It really has
not come into the public domain. In fact, I remember what was there previously was a
Blockbuster video, and we know what happened to Blockbuster, and there was a luggage store
that was there for awhile. Then there was a travel agency that was there and they all seemed to
be doing moderately well until they were closed down for the construction work. Adjacent to
that where the E*Trade is that used to be NBBJ, an architecture firm, so that obviously fell under
office use. Then on the flip side or the backside looking at the comer I guess the comer of High
Street and Hamilton is the Fazani parking lot. The Fazanis' have never really done anything
with that lot. Isn't it a little premature to take a blank lot and then takeaway something that it
hasn't even had an opportunity to build a building? The Fazani's in fact have been very reluctant
to have landscaped it or made it into viable parking following our regulations. So that is the
question.
Ms. Cutler: Would you like an answer and discussion?
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Commissioner Lippert: Yes, please.
Ms. Cutler: Part of what this really gives us the opportunity to do is to think conceptually about
the Downtown and what the important retail areas are, and which areas based on traffic patterns,
existing buildings, but also future desires for the area might work better or worse for retail, might
be more or less important to the Downtown core and the vitality. Spreading retail throughout the
entirety of Downtown, there isn't enough retail to do that, and so thinking about where it is is
really important and is really viable for retail. These ends are often more difficult because if you
are not a destination retailer then you don't get as much foot traffic because you are right at the
end there. When you are over by the train station that is slightly different because you do have
people coming from the train so you get a bit of that, so that was some of the discussion of those
over there in terms of the viability there. Also some of the discussion of some of the other side
streets and continuing it along, keeping all of the existing retail, part of this discussion of
loosening up the regulations in CD-C is a recognition that we want to focus our protection and
our attention on what areas of Downtown we think are really important for retail. Then let the
others follow economic factors.
Commissioner Lippert: One of the bright spots focusing on retail is that we do have Patagonia in
there and they are benefiting from the fact they are next to a parking structure. On the flip side
of that we have the last remaining full service copy shop in the Downtown. They are really
supported by traffic from I guess Stanford University, jobs that they have through people that do
large-scale printing. Doesn't it make sense with University circle being a gateway to the city to
think of it in terms of perhaps future mixed use where you wound up with ground floor retail and
it could even be housing above it because it is right near a transit center? Does that not make
sense?
Ms. Cutler: I think that is a valuable discussion for the Commission to have this evening about
what areas are going to be valuable and useful, being aware of those areas that are difficult in
terms of visibility as cars come through, as I believe Curtis mentioned earlier, as they come up
from underneath Alma along University they kind of miss the first few buildings on University,
so there is a loss there of visibility, and then also the connection to the train station and to
Stanford. That is traffic that goes through there.
Commissioner Lippert: I will pick up my line of questioning on the other side.
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Chair Garber: Commissioner Martinez.
Commissioner Martinez: As a relatively new comer to Palo Alto I thought it was important to
listen to the comments and sort of get a sense of the history of this problem. When I first looked
at it I thought about one of the reasons why I wanted to live in Palo Alto, and that is because I
felt the Downtown was so vibrant that it was pedestrian friendly and encouraged us to walk, all
of those things as an urban designer that I really care about. So I had to ask myself well, what is
driving this problem? Is it from an economic perspective that we want to encourage retail that is
long lasting? To support the retail that we have that could benefit from having those vacancies
filled with retail that brings additional customers Downtown? Is it an urban design perspective
where we want to enhance the pedestrian experience? I anl sure there is a truth to all of this. So
I still was not sort of satisfied that I had reached the ultimate reason why we want to do this.
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Certainly when I look at the map I agree with your recommendations for those changes. I have
seen in other cities that retail that is located along high-speed or faster speed streets for some
reason doesn't do well. Maybe people are not drawn to it because of the traffic noise and the
idea of safety. Maybe there is something else to it, but I feel I can support your
recommendations that on the circle we don't have retail or give it as an option that office would
probably be as equally supported.
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I do have some concerns about what we characterize and what-we have included as retail. I am
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also sympathetic for those property owners that have buildings that are not suitable for retail. I
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think we definitely have to take that into consideration. I remember when I was working in New
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York there was a ban on travel agencies because the Planning Department felt they were kind of
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boring to the pedestrian experience. Granted at the time there were a lot of them on 5th Avenue.
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It also calls into question sort of our assumption about what is good retail and what we have
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included. I think a design office like the former NBBJ was as vibrant as a travel agent, maybe a
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little bit more. So I would really ask that we look hard at what we are including in this list of
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long time ago before we invented urban design. I think if we looked at it from a pedestrian/retail
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experience now, and even the banks would design them in a different way that they became more
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pedestrian friendly. So just in closing I would really like us to take a hard look at what we have
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included as acceptable retail before we go forth with what we include and exclude in ground
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floor retail. Thank you.
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Chair Garber: Thank you. Although I have been here slightly longer than Commissioner
Martinez I was not at this last meeting that this was discussed. I was out of town so I am
benefiting from a lot of the discussion here. Thank you.
A couple of quick questions. There is a property at the comer of Cowper and University, which
is not included as one of the colors. Is there a reason for that or is there supposed to be a color
there that is not shown?
Ms. Cutler: The properties that are within the Downtown that don't have a particular color to
them generally are either Planned Communities, PC zones, or are Public Facilities, PF, so are not
part of the CD-C and don't have the GF.
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Chair Garber: So that one comer is probably a PC?
Ms. Cutler: Yes.
Chair Garber: I had one other question. I don't recall but I don't believe there has ever been an
ordinance written in this way in this community. I am curious if the Staff is familiar with other
communities that may have created ordinances around the amount of storefront that can be
dedicated on a block to a singular use or occupancy. It may be all owned by a single landowner
but it may have different occupancies or there may be percentages applied to that in order to
establish the vitality that particular community is interested in. Is the Staff familiar with that sort
of an approach? I am not recommending it I am just curious.
Mr. Williams: I understand. You are talking about an amount of storefront for a particular use.
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Chair Garber: Yes, so for a community that would seek to avoid for instance the B of A problem
that we have on that particular block where it is all one use.
Mr. Williams: Yes, but suppose that use were in three different buildings scattered throughout
the block that is not what you are talking about. Maybe you are talking about continuous ....
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Chair Garber: Contiguous.
Mr. Williams: One use in one building.
Chair Garber: Yes.
Mr. Williams: I think there are cities that have done that at least for anything new coming in,
they probably have grandfather provisions for things that are there, that do try to set frontage
widths for businesses if they are narrower they tend to encourage more doors, more windows,
nlore retail probably than if they are larger spaces that might handle a larger retail. Then again,
that might be more difficult to get in and you end up with banks or offices or something like that.
I believe, I don't know what comes to mind right now, but I have seen in some locations where
they do that from more a design perspective maybe than the use, and say you have to have a
maximum width.
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Chair Garber: For instance in like a PTOD zoning you might create that.
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Mr. Williams: Yes, sure.
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Chair Garber: Okay. That is all I have. Commissioners, lets do a couple of quick straw polls.
What I am going to be doing is walking down the Staff recommendations here. We will do these
quickly so that we can spend .....
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Commissioner Holman: Commissioner Garber, I am really not comfortable we have had enough
discussion yet to do straw polls unless your straw poll is just an initial .....
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Chair Garber: I think it is just an initial here because I am thinking it might help us focus our
conversation.
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Commissioner Holman: Okay, as long as we can revisit.
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Chair Garber: Yes, I am not precluding.
Commissioner Holman: Okay. All right.
Chair Garber: In addition to you I think there are some other Commissioners that want to
continue lines of questions.
Commissioner Holman: All right thank you.
Chair Garber: Abstaining is fine too, yes. It is just a straw poll. So let me just ask the
Commissioners, if the Commissioners would raise a hand to tell me if they would support the
Staff recommended changes to Ground Floor Combining District regulations where the Staff
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recommends the removal of PAMC Section such that there will no longer be the option for the
use exception based on vacancy rate. All those in favor? Okay, that is all of us.
Do the Commissioners support generally the Staff recommended changes to Downtown
Commercial Districts so that the loss of flexibility on the ground floor uses in the Downtown
core are covered by GF Combining District will be balanced by an increase in the flexibility in
the ground floor uses in the periphery of the Downtown? All those in favor? Four, so there is
some discussion there. Good.
Let me break the next one into three pieces. The Staff recommended revisions of the zoning
map. First let me ask if there is support for the Stafr s recommendation of the removal, the three
bullets that remove the GF protections. These are for the properties along Alma Street, portions
of High Street near Hamilton Avenue, removal of the GF protection properties along the circle
ramps connecting University Avenue and Alma Street, and then the three miscellaneous nonretail parcels along Kipling and Cowper north of University. Support for those? One, two, three.
Then let's see if there is support for the addition to the GF protections to the existing retail on the
south side of the strongest block of retail on Hamilton Avenue and to the Aquarius Theater and
the two restaurants immediately to the north on Emerson. Support for that? That is six.
Then finally is there support to not change University Avenu~east of Cowper and not change
Bryant between University and Hamilton Avenue. Support? One, two, three, four, five.
Okay, Commissioners, Commissioner Holman, and then Lippert.
Commissioner Holman: Yes, and I guess first I will make my argument for the circle. The
purpose of that is we talk a lot in this community about connectivity. That was a four-three
straw poll so I am going put out my best effort here, or hopefully. We talk a lot about
connectivity and I think what is similar to the California Avenue train station issue is that there is
that blank wall. I understand the restaurant there has had a hard time surviving but there is that
blank wall that leads you down there. It is really problematic. That building, I am not
particularly for demolishing buildings, but that building should just be blown up and start over.
It is terrible from a pedestrian and connectivity and retail vibrancy. It just loses it big time. I
don't want to create that same thing here.
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When people come from Stanford campus, when they come offEl Camino, when they come
from the train station there really needs to be a vibrant comer there. There is a parking garage
right behind it so there is adequate parking. Along with Commissioner Lippert, I have been here
a long time 34 years I think it is, and there have been long-term uses, successful uses, there.
There was a sporting goods store there forever. I think it was Bungee Travel or somebody was
there for a very long tinle. Blockbuster was there for a very long time. There have been some
long-term surviving businesses there.
I guess I have a problem with the development on the south side of the circle not getting much
traction because in zoning we say that you can't create your own disadvantage, basically. That
building that new building is designed such the whole ground floor is basically a lobby. So it
seems to me that what we have allowed there with the design of that building is a difficult
building to rent as retail. So you have created your own challenge.
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Chair Garber: Commissioner, help me because I am either not following or slightly confused,
both of which are entirely possible. Are you relating that to this second Staff recommendation or
is that just specific to the changes to the map where we are removing things and that was the
item that was ...... ?
Commissioner Holman: I am currently talking about the removal of the properties on the circle.
That is what I am talking about.
Chair Garber: Okay.
Commissioner Holman: So that is one issue. I think they have created their own challenge
there.
I would agree with Commissioner Keller, and there have been proposals and opportunities that
have been presented down Alma and at the comer of Hamilton and High Street, so I just don't
see the logic in taking that out. So I could hit several different points here.
As far as Emerson Street and adding, it may be a finger but it is one block, all we are talking
about is one block being added to connect to the SOFA II district. It is one block. So I would
want to add that.
I don't want to confuse us by covering a whole lot of points at once so I will probably stop there
for the moment.
Chair Garber: Thank you. Commissioner Lippert and then Keller.
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Commissioner Lippert: I just want to follow up on Commissioner Holman's comment with
regard to University circle. Again, I can see it being problematic but that is an area that has just
been born. There are many things that are going to be happening in that area over the years it
just hasn't been given a chance. Even though we are in an economic downturn tum right now
whatever happens there is vital to the transit center. The dream team plan is to make that a major
plaza and entry into the city. So in some ways if that ever turned to ground floor office and
remained that way we would be stuck with that if ever we were to enhance or improve the transit
center, and that connectivity with Palm Drive. So I think it is something that we dearly need to
hold onto in terms of it being a gateway to the city.
Chair Garber: Commissioner, forgive me Commissioner Tuma has a question related to that.
Sorry, never mind.
Commissioner Lippert: I had one other question in there. Once you demolish a building does it
revert back to the underlying Ground Floor Retail zoning or does that go with the previous use
that was there? So an example is an office that moved into a retail space. Let's say it was one of
the small retail shops on Bryant Street, which aren't doing particularly well, the gallery spaces.
Ifwe were to intensify what could be built there, and those were demolished, would that office
space remain with that property on the ground floor or would it then revert back to it having to
be leased as retail with whatever uses above it?
Mr. Williams: I believe that if it were demolished and start over that it would need to conform
then to the use which if the GF exists there then it would have to be a retail ground floor use that
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comes back. Differentiate that from just changing the tenant but leaving the existing building
there that can continue to go as office, like 285 Hamilton has done, go from office to office to
office. If you scraped it and built a new building then our code as far as nonconforming uses
basically says that if you construct something anew that then you have to comply with the use
that is the basic use for the site.
Commissioner Lippert: So basically what I am looking at is there would be a viable life to it
because as smaller buildings came into wanting to take advantage of the land and the
intensification of that land there would be an opportunity for rebirth. So there would be in some
ways a self-fulfilling death to that ground floor office use with intensification of that land.
Chair Garber: Commissioner, forgive me one more time. I apologize. I am thinking that the
topic of the University circle is a particularly hot one and maybe what we should do is draw out
any other comments that are specific to it before we move on and then we can come back to you.
Would that be acceptable?
Commissioner Lippert: Yes, except I keep losing my line of thought on this.
Chair Garber: Your choice.
Commissioner Lippert: Why don't we go ahead and I will come back to my thought.
Chair Garber: I know that Commissioner Tuma had a comment about that. Commissioner
Fineberg and Martinez, and then we will come back to Lippert and then Keller. Commissioner
Fineberg followed by Martinez.
Commissioner Fineberg: When I am thinking about the area on University circle the question
comes to mind why are we considering making the changes, and what are we trying to
accomplish? In my mind, there are multiple factors that affect that area that come into play. So
it hinges to me on then what are we trying to accomplish? The multiple factors that come into
play are the economics. Right now we are in a recession. Retail tenants are hard to find. It
might be more profitable for a landowner to rent to an office use, office tenants. There are what
I will call safety issues. When a person is shopping in the neighborhood how safe do they feel?
Is there a vital environment with lots of people? Or is it dirty or unoccupied and dark, or light
and clean and open and vital? There is convenience. There is either parking or hard to find
parking. There are public bathrooms or not There are either lots of cars and traffic or it is easy
to get to. There are also profit motives of both landowners who want to maximize their income
streams, there are profit motives from business owners who would prefer probably paying less
rent and having more customers, and there are also the residents who live and work and shop or I
should say people who live and work and shop and who will be customers in those stores. They
don't all have consistent goals and desires. So what are we trying to accomplish? Are we
reacting and changing zoning because there is a short-term economic downturn? Are we going
to rezone and then regret it if the economy picks up or are these re-zonings things that will stand
the test of time that five and ten years later will serve us well? I am not sure on that University
Avenue area that I know the answer to that right now. I am not sure I know the answer to what
is going to make it vital for the people who are in the area. We have talked about the City's
outreach to the business owners and the landowner and property owners. This is actually a
question for Staff. Do we have any sense of what is it that people want there? Is it that the
businesses would need lower rents? Is there some type of business that we can say that is what
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would attract people to come to University circle? Then what zoning would support that if it is
retail or have we simply come to the conclusion that we are giving up, it can't be retail, it needs
to be office? So if Staff could address that.
Mr. Williams: Well, first of all we are not saying anything needs to be office and we don't
believe that we are going to see some wholesale change by making that change. There are lots of
areas down here again that - this ordinance in the yellow that requires retail to remain retail is
now eight years old. There were lots of retail spaces in those areas before we had that provision
that required that. Now there are surely some properties where it may be found to be beneficial
to convert to office but there are also properties that I know I have fielded phone calls about
somebody wanting to put retail into one of those yellow areas that is office now. When they find
out that they can't ever convert that back to office they don't do it. So we don't have some retail
spaces come in that might otherwise.
I think your question is a good question as far as what we are trying to do. I think what we are
trying to do generally is assure that we don't begin to have, first and foremost, incursions of even
the flexibility for incursions of office into the primo core of Downtown retail, ground floor retail.
So that is what the first and obviously there is pretty good consensus there on that first issue of
the vacancy rate.
Then the others are I think not as clear-cut. The second recommendation relates more to a sense
but perhaps not a highly quantified one of having that flexibility and that being advantageous to
accommodate some retail in spaces that are not going to get it now, and by the same token not
sort of diluting retail by requiring it in outlying areas where maybe it could better be focused in
the core.
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Then relative to the mapping I think again that is trying to look at are there spaces that are more
marginal where retail doesn't seem to be particularly strong to sort of rate the core restriction but
we still would anticipate that a lot of those areas are still going to remain retail, some of them
probably won't. I think those are the grayest areas you have already discussed. We have heard
and seen discussed arguments on both sides of those for University circle, for Emerson, and for
Cowper on the far end was one we discussed quite a bit and left it in, and Bryant at High Street
as well. So those are grayer areas and I guess there don't have to be chang~s to the map but we
think that these can help strengthen again identifying where that GF zone really goes and
providing more flexibility to the other sites.
Chair Garber: Please go ahead.
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Ms. Barnes: If I could follow along, as we started to talk about this and got more concerned
about the retail vacancy in the Downtown I contacted Economic Development Directors in about
20 other Silicon Valley cities. We talked about our five percent threshold and whether or not
that five percent threshold made sense, and what their vacancy rates were like, and what numbers
they were looking at. Almost exclusively in the downtowns that were vital we found out that
there was no flexibility in that downtown core. That it was retail, however they defined retail,
and that they intensified that core.
The kinds of fluctuations that we did see were they had concerns about types of businesses. For
example in Los Gatos they were really concerned about chains. So they went about defining
what they thought a chain was and some place with seven or more establishments was
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considered a chain according to their rules and that kind of goes along with the conversation that
we had about restaurants. People talked about restaurants but almost unanimously we heard
from both business owners and property owners that the market would dictate that and that was
part of why we were are as vital as we are was because the market had dictated good uses in the
spaces that we had. But we did actually try to get some more information from other cities that
had vital districts and were concerned about maintaining those districts as well.
Mr. Keenan: Cicero said not knowing your history is like looking at the world through the eyes
of a child. In 1984 when we built the 300 and 400 office buildings there, Wells and now Chase,
the biggest grossing restaurant in Downtown was the Burger King where Pizza My Heart is.
Retail is a very fragile business. You see them come and they go. Frankly, no change is fine.
The impetus for this was gee, we have a vacancy factor that is starting to be meaningful, and
those protections are now the release valve is operative. The fact of the matter is that there is no
big rush. They don't get people saying we want to put offices in that core retail. It is not the
issue. But, we are almost unanimous, and you were unanimous on keeping that core solid. The
"best of' we really want to be restrictive.
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There is a quid pro quo from a property owner's point of view and that is flexibility on the CDC, the yellow up there, to flip in and out depending on what the market is telling you. I can tell
you retail pays more than office right now but demand shifts. I own the Fazani parking lot. It is
just a terrible retail comer. I have a little jewel box of a retail building approved there and I am
not going to build it. It is just not a good retail location. Where Pampas is right now, that is my
first baby, my first building. We bought it from Earl Scheib for $70,000. He had all those auto
painting deals for $1995. I left that building three years vacant because I couldn't do anything
else but retail. My first use in there was an architect and then it switched to retail and now it is
retail forever. I don't want to look, if I ever lose that tenant, that I am going to have to go dark
Chair Garber: Okay. Commissioners, Tuma, Martinez, Keller let's try and keep our comments
brief because we need to try and nl0ve this along.
Vice-Chair Tuma: Okay. So here is my thinking on the circles. I think when we look at what
Planning Director just told us about what we are trying to do here, which I think I agree with,
strengthen the core, keep it solid that area right there - I go Downtown for a lot of things and I
come up Alma Street from where I live down in Barron Park or I am coming from Stanford I
spend almost no time as a consumer at that end of University. That doesn't mean that there
aren't viable businesses that could be there from time to time but I am not convinced that that is
integral to strengthening the core. I think if you could have some from time to time office space
there with the proximity to transit it would make a lot of sense to be able to have that flexibility.
So to me keeping it only as ground floor retail isn't as big a driver and I think you could get
some benefit by having some ground floor office there. The people who work in those offices
then could shop and contribute to the retail. I don't know, I just think it is not necessarily that
accessible from a retail perspective. There may be certain businesses that it works for there. The
proximity to transit in a way says let's allow more office there. The strength of the office there
could participate in the retail. So I don't think removing this restriction is necessarily a bad
thing. I think it is actually a good thing. I think it would contribute to the flexibility and the
viability.
Chair Garber: I am going to interrupt just briefly. Do any of the public speakers that have
spoken like to speak to this particular issue? Mr. Keenan.
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three years waiting for the next retailer. I think Patagonia is doing okay so it flips in and out, and
the restaurant is doing okay. It is a tough market right now so I think they have more runway in
front of them. The Fazani building on the comer is not a good retail comer. Somebody said
high-speed traffic really affects those areas in terms of retail viability, they are not walkable, and
so I would encourage you to take that into consideration.
Then Karen Holman's comment that one block, just give me that one block on Emerson, I defer
that I am the daddy of the Emerson resurgence. I will let Faith be the grandmother of the
resurgence because she was there first, and she was the true pioneer. Coming down to Whole
Foods, which we developed, and the Little Bijou Theater and redeveloping all that into retail that
was us. You have Anna Eshoo's office on the comer there of Forest and Eme:t;.son, that's office.
My office is on the other comer. You have a skin guy. It is eclectic. These pure lifestyle
centers, retail, are dying all over America that are a lot better done than this with a lot better
parking. So the idea of really burnishing our golden geese here, which is University Avenue and
what you see in orange there, I think, is great but we need a little more flexibility to hard lining
those changes.
Chair Garber: Thank you. Commissioner Martinez and Keller. I am sorry, you have a question
from Commissioner Keller, and then we will go to Comnlissioner Martinez.
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Commissioner Keller: Thank you Mr. Keenan. My question is the proposal by Staff is to have
no controls on the non-GF portion of CD-C. I am wondering whether some sort of control like a
CUP or something on the new experimental retail could go back or is there some sort of
approach that you think would work and allow you to experiment with retail and not have a oneway ratchet that would be more than simply no control at all.
Mr. Keenan: It kind of gets to be more fashionable than the rule of law. The dirty little secret
about Palo Alto that I don't like to spread is that historically, it has changed but historically you
have zoning, you stay in the zoning box, you go to ARB, you are compelling at ARB. We don't
see you guys. We don't see the City Council. It is beautiful. The PC has sort of changed that.
You have never seen me do a PC. I stay in the zoning box. So I want to go and be compelling to
the Architectural Review Board contextually, what does this building look like, but the CUP
process, which incidentally everything in Menlo Park is a CUP. Everything is a use permit, and
everything is politicized. Decisions are not made in Palo Alto time they are made in commercial
time. So CUPs I think are a significant hurdle that is not enough to give up my safety valve on
really what is important in the GF.
Commissioner Keller: I realize this perhaps going too far but what I am wondering is suppose
what we did is we say any new retail in the CD-C you could go anyway you want, you could go
back and forth, and any of the existing retail that is over there in order to go from that that's
existing presumably for some period of time would require a CUP to go the other way?
Mr. Keenan: Well, I am always trying to find the middle of the table and I appreciate your
gesture but I will give you an example. The Thoits Brothers own, they have a gym in there on
Emerson and it is sort of on Karen's block. That was the Chronicle. They had their news bureau
in there, an office use, and it went to retail. These things get too theoretical. You are not going
to see that yellow all go to office tomorrow. It is like when we did the down zone in Downtown
Palo Alto from 3: 1 FAR to 1: 1 FAR. Everybody took the ground floor square footage and
multiplied it times three and said do you realize we could have 4.0 million feet of new buildings
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in Downtown Palo Alto? The fact of the matter is that there is economic value in all of these
buildings that preclude that. It becomes too theoretical. I think this is that case. You are not
going to see any wholesale changes. You nlight see a little around the edges but from a property
owner's point of view flexibility and meeting the market and getting good retailers that is just
what helps us keep it vital. It focuses your good stuff where you do have good parking. We
work hard, spent $42.0 million on new parking structures Downtown. So I think keeping the GF
strong, stronger without a relief valve nobody here is arguing for a relief valve, but there is that
flip.
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Commissioner Keller: If the Chair will indulge me I will just ask you one more question.
Sometimes on the Commission there have been discussions about the idea, which was mentioned
by Susan Barnes the idea of basically chain stores versus non-chain stores. Do you have
thoughts in terms of what kinds of restrictions we might consider sometime in the future? As
long as you have the floor.
Mr. Keenan: You want to go San Francisco? Retail is fragile and I will just leave it at that. You
eliminate chain stores which is where they get the capitalization and that would be a disaster, as
would eliminating restaurants or constraining restaurants. We don't have many anchors here.
Our biggest anchor is now Apple. It is a huge store. It is remarkable. The second biggest is
probably Borders. It is one of their very top stores. We are not going to get Urban Outfitters
where Magnolia went. I just heard that today. So it is a very fragile item. If we had to take
those stores off of the table what do we have left?
Commissioner Keller: I am not suggesting that we eliminate chain stores but if we limit them in
some way so that we have more of mix, do you have any thoughts on that?
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Mr. Keenan: I think it is a huge nlix now and the pejorative chain I think is really misused. It
usually just means that somebody who is in that business doesn't want a new competitor.
Commissioner Keller: Okay, thank you.
Chair Garber: Okay, let's interrupt and get refocused back on University circle. Comnlissioner
Martinez. I'm sorry, Commissioner Holman.
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ConlIDissioner Holman: You asked for members of the public and there is another member of
the public who wishes to speak.
Chair Garber: Please, Faith Bell.
Ms. Bell: I appreciate the opportunity to speak. First I want to say that it is significant to me
that the landowners and merchants of the affected buildings are not being informed at this point
in the process. I think that is really a mistake.
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Second, I would like to say that the owner of Jungle Digital Copy has spoken to me and is
strongly opposed to the lapse of the Ground Floor zoning for his building. I think that is
significant.
Third, I would like to note that there is the relatively new parking structure there in that location.
When we were discussing it at previous meetings people were saying that parking was
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problematic there because there wasn't something visible at the street. I think that with proper
signage that could be really encouraged.
Fourth, I would like to remind everyone that the last figure I heard on empty office space vacant
in town was 110,000 square feet. I don't know if that is true or not but if that is the case we
certainly don't need more ground floor office space.
I would like to support Commissioner Lippert's comments regarding the potential of the
buildings that are under construction now. I know that the designer of the building that is on the
circle there spoke at one of the previous meetings where I was with you, saying that he had
dreams of a really vibrant retail for the bottom of that building. He had designed it with that in
mind. I would also like to mention that the rents could be a significant factor in this and if the
landlords were willing to bring the rents to within something more manageable we could get a
more vibrant retail mix that was not just chains. Ifwe want to bring a town into place here that
draws people to something other than what the Stanford Shopping Center looks like then maybe
we need to be looking at that. When the developers cry hard times maybe they need to be
looking at the rents too. I don't know because I am not in that business. I rent to myself.
Thanks for designating me the grandmother job.
Commissioner Martinez: If I understand this correctly we are not precluding retail on the ground
floor of University circle.
Ms. Cutler: No, it would just be removing the Ground Floor overlay. So it would be reverting
back to the CD-C, just those allowed uses, which include all of the uses that are allowed in the
GF District as well as a number of others.
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Commissioner Martinez: So we can just allow the market forces to do what they are going to do.
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Ms. Cutler: Precisely.
Commissioner Martinez: Okay. From my point of view whether it is retail or something else,
office, on the circle is less important than the circle itself. It feels like it could be a grand
gateway to University Avenue. The buildings with due respect could have been a little bit more
vigorous to reinforce that. Unfortunately we have what we have. That doesn't preclude public
improvements to street trees and street furniture and lighting and paving as a way to make a
grand sense of entrance to the Downtown. I think that is far more important than what type of
use occurs on the ground floor.
I think high-tech offices reflect greatly on Palo Alto as do sort of unique retail. There is no
guarantee that retail there would be more than a nail salon or a dry cleaners or anything else. So
I think to insist that it can only be retail is really putting the cart before the horse, and really
imagining something which may not come to fruition.
I just wanted to say on the plan that is being proposed when I first looked at it I thought well,
why are we imposing restrictions at this point in this recession? Then I looked at it again and I
asked why are we imposing restrictions at this point in the recession? I think in the latter way of
looking at it what I was thinking was that with vacancies of ten, 15, one speaker even said up to
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20 percent we have the potential of having vulnerable retail spaces converted to office. This is
not for the duration of a recession this is five, ten, 15 years, who knows. That doesn't contribute
to the vitality of Downtown, not to the core. So I am very much in support of the planning
ordinance for the Downtown core and really looking at ways of enhancing our commercial
district. Thank you.
Chair Garber: Commissioners, before we go on we need to finish up with Commissioner Lippert
and I have not taken straw polls on the final two Staff reconunendations, which we need to do,
which will bring us into a conversation about restaurants. Commissioner Lippert.
Commissioner Lippert: One more line of questioning here real quick. With regard to the five
percent threshold that we currently have in place if we were to relax and allow for the conversion
of ground floor retail into commercial office because of this threshold that we hit, is it the
differential or the delta? Say we are at ten percent so it would be the difference between that ten
percent and the five percent that would be permitted to be converted to ground floor office or
would it be the whole ten percent?
Ms. Cutler: My understanding of the way that it works, and if I get this wrong you can correct
me, is that the City does a calculation of what percentage of the square footage in the GF zone is
vacant. Based on that calculation that is done once a year in the fall, around this time, then it is
either over the five percent or not. If it is over the five percent then people can request a use
exception to allow office on the ground floor given certain conditions, the six month vacancy and
available being one of the primary ones. Once that calculation is done in the fall we don't
recalculate it again until the following fall. So that use exception is available until it is
recalculated again and determined to be less than five percent.
Commissioner Lippert: So that would be available to any ground floor retail space even if we
were to exceed, let's say we were fill all of that ten percent square footage with office space it
could even gobeyond that.
Ms. Cutler: If space could be shown to have been vacant for six months and available for six
months they could request that use exception until we recalculated the vacancy rate again the
next fall and determined that it was less than five percent.
Commissioner Lippert: Okay. I would like to make some comments here if I might?
Chair Garber: Go ahead.
Commissioner Lippert: I think that Commissioner Martinez really hit the nail on the head in
what he was saying in terms of preserving the Downtown. I would like to put some legs on this
if I might. By that what I mean is I think we have an opportunity here in the relaxation in the
yellow area. We are in a very, very, very difficult economic time right now. The idea that I see
or maybe this is what Staffwas trying to get across here is that because we have reached this
threshold trying to get more offices into the Downtown area and by relaxing that standard
eventually at some point we are going to see the economy return and there really is a symbiotic
relationship between office and retail. You cannot have one without the other. If you have only
office space you wind up with a Downtown Dallas. Dallas' zoning is two zones office and
parking. That is it. Sorry, there is one more zone, there is a retail zone. It is the Neiman Marcus
department store. Off in a small comer is a food court. That is what you wind up with. It is a
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deadly downtown. It doesn't work. You need to have office and retail in order for the two of
them to be able to survive and they need to be symbiotic. So by relaxing I think the yellow area
and allowing for ground floor office uses in that conversion we will see a critical mass eventually
return and strengthen the retail core to our city.
I also feel that we must draw a line in the sand and preserve those retail uses. So I am in support
of what I see here today. I am not, however, in support of taking the area around University
circle and simply taking the Ground Floor overlay off of that, the Ground Floor retail overlay.
So those are my comments.
Chair Garber: Thank you. Commissioners, to keep things moving here lef me poll you on the
last StaffreconIDlendation, which was the Staff recommendations on Limits on Businesses of
Concerns, in which the Staff is recommending that we do not limit. Commissioner Holman.
Commissioner Holman: Before polling don't you think we ought to have at least one round of
just comments on that one topic.
Chair Garber: Sure, we can do that. Would you like to start us off?
Commissioner Holman: Sure. I found the language in the Staff Report interesting because it
says in regards to a concern expressed by the PTC about the number of restaurants and public
feedback received strongly supported the idea that economic forces would provide sufficient
controls and that the additional process and expense that would be imposed on potential new
restaurants, so I am a little bit unclear on what that means the cost imposed on potential new
restaurants that is unclear to me, in order to limit their numbers would have a significant negative
impact on the vitality of Downtown. What is missing for me in these comments is but what does
good zoning practice say. That seems to be missing. The comments that are indicated here are
just from public and property owners.
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There is a reason why, and I would Staff to comment, there is a reason why for instance Los
Gatos, I am not proposing this but, Los Gatos limits chain stores or doesn't allow chain stores.
There is a reason why Burlingame restricts the number of restaurants. So can Staff conIDlent on
that, please?
Ms. Cutler: I would say that in terms of what good zoning practice that we took into
consideration and maybe didn't mention in the Staff Report was more about a concern about
over-restriction. That in providing a list of allowed uses on a site providing flexibility rather
than narrowing it too much. Also, I have heard from the Planning Commission a strong interest
in supporting new businesses that want to come in and allowing them a process that is no overburdensome. So when we heard a lot of comments and concerns about that that seemed a very
important part of evaluating this option. If there was some sort of additional process that had to
keep track of how many restaurants for instance there were in the Downtown that that adds a
whole other layer whenever a new business is coming in. It wouldn't affect existing businesses
because they wouldn't need to be asking for pennission to·come in if they are existing. So we
definitely take into consideration both the input from the outreach as well as just a general
zoning practice of providing flexibility of what is or is not working because we can't as planners
dictate what types of uses really are going to survive in a certain location.
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Commissioner Holman: I guess what is still missing for me is the discussion about what creates
a good shopping and dining sector. It isn't an exact science, understood, but I have heard
retailers talk about people who come to eat don't necessarily come to shop. People who come to
shop eat. There is that. I have also heard developers say that once a building is converted to a
restaurant that it is going to be there for a very long period of time because of the capital
investment. I have also heard both members of Staff, members of the community, developers,
you have heard this Commission say too that restaurants, and I am not trying to pick on
restaurants or restaurant owners it is land use that is what it is about is uses. That restaurants are
parking hogs. They don't have the biggest return on sales tax dollars per square foot, and once
they are in place they are going to be there for a long time. So we are not going to get retail in
those locations. One of the major businesses Downtown that has left I went in after the
Thanksgiving big sales held this last year. They don't know I am on the Commission. They
don't know me from Adam. I was in shopping and asked how was it? Their immediate
comments from two people at the counter were well, it was okay but it really wasn't what it
could have been if we had more retail around here. There is no place for people to come
shopping for children's clothing or toys, and they named a few other things. And, he mentioned
that there are too many restaurants. That is one indication. I think there is serious consideration
for the impacts of restaurants specifically, and market forces are necessary but I think it is also
important to decide as best we can what is appropriate and what is most desirable in our retail
districts. So that is I guess what I find nlissing in the Staff Report and in that discussion, impacts
and benefits. I just don't see that here. So I am hoping the Commissioners will hopefully take to
heart some of these comments if you find value in them and we can discuss them.
Chair Garber: Commissioner Tuma, Keller, Fineberg, and then Lippert.
Vice-Chair Tuma: Did you say that you had reached out to the other Econonlic Development
Coordinators 20-odd so in the area, and you talked about this topic about restaurants? Could you
give us a little bit more detail about what the feedback was from other cities?
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Ms. Barnes: Sure. What we did when we initially began to sort of explore this situation, I
belong to a group called Silicon Valley Economic Development Alliance, so what I did was I
reached out to the Economic Development Directors in all of these other cities and asked them a
couple of questions. One of the questions was if you had a restriction on your ground floor retail
and whether or not there was a threshold at which other kinds of uses could locate there. Like I
said, almost completely across the board they said now we don't have a threshold percentage.
Some of them were considering a threshold percentage.
Vice-Chair Tuma: Sorry, let me just for expedience sake, did you specifically discuss the
restaurant issue?
Ms. Barnes: I am trying to think. We asked if there were restrictions because that is how I got
the question answered about the chains. We asked if there were restrictions on restaurants and
Burlingame was not one of the cities that we reached out to. It was more sort of San Mateo and
south. That is where I got the answer back about chains and that was the only restriction that I
heard back from anyone in that group that responded.
Vice-Chair Tuma: Okay, so of the 20 that you did talk to none of them that you know of have
restrictions on restaurants?
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Ms. Barnes: The only mention that I got back and I could explore it in further conversations a
little bit more deeply, from those that I got responses from that is where that information on
chains came.
Vice-Chair Tuma: In the discussions that Staff has generally had around in the various different
meetings and discussions have you had any input from anybody in those discussions that
indicated that limiting restaurants was a good idea?
Ms. Cutler: I did not hear that. There definitely was agreement that the capital investment in a
new restaurant is a significant one. There was definitely agreement to that but there seemed to
be a lot of enthusiasm for the importance of the restaurants and the vitality of the Downtown,
that it meant that businesses were open later, had more activity longer say in comparison to Los
Altos where most of the businesses close at five or six o'clock because there are so few
restaurants.
Vice-Chair Tunla: Okay. I am not in favor of putting a limit on restaurants. When I think about
just in the last couple of years the little bit of evening activity that I see on California Avenue it
generally comes out around the restaurants, and in particular having the counter and the Indian
restaurant and the Starbuck's, all those are starting to add some vitality and some presence of
residents in the evenings. I do think that the economy and the business trends will sort of take
care of this. I realize that for larger scale restaurants you do put in infrastructure, and they are
there, and they are there to stay. I think they add a lot of vitality to a district so I would not be at
all in favor of putting any kind of limits. I think we let the marketplace do that.
Chair Garber: Commissioner Keller, Fineberg, and then Lippert.
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Commissioner Keller: So let nle make some observations by way of comparison. If you look at
Castro Street in downtown it is essentially restaurants. There is hardly anything else there in
downtown. Basically, you go there for restaurants. I would say it is 80 or 90 percent restaurants,
there are a handful of other stores, there is a little market, the Mountain View Market, and a few
other uses like the Odd Fellows things, but essentially it is restaurants. There is hardly any other
retail. I think that shows the problem of having too many restaurants that essentially it is a
restaurant designation and nothing else. There are some office uses on top but that is basically it.
If you look at downtown Menlo Park it is a mix of restaurants. There are somewhat fewer
restaurants than in Downtown Palo Alto but there are a lot of other more healthy mix of retail. It
doesn't seem to go that much into evening, which does speak to Commissioner Tuma's point.
On the other hand the idea is that there is a lot more retail going on there, mixed kinds of retail in
downtown Menlo Park than there is in Downtown Palo Alto. Interestingly enough Menlo Park is
going through its own process of how much increased density that they want there. That may
wind up converting that entirely into who knows what.
I am also familiar with say downtown Los Gatos. There are a couple of streets in the Old Town
where there is a mixture of restaurants and other uses that seems to be a reasonably healthy use.
Downtown Los Gatos seems to have a lot going on there in the evening. Downtown San Mateo I
am familiar with 3rd and 4th Street, B Street around there. That has more restaurants but there is a
mixture of uses. There is a grocery store there that seems to do pretty well and a couple of other
uses like that.
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So it seems to me if you think about this it may be seen that there is an optinlal amount of
restaurants that one might have. If you have not enough then you get something which sort of
rolls up the sidewalks at night. I remember when I was a grad student here in the late 1970s and
early 1980s Downtown Palo Alto rolled up its sidewalks. Now the amount of restaurants that we
have now seems to have created a night life and a little bit more flow and that to keep more hours
as contrasted as was mentioned with Los Altos where there is hardly a soul there any time at
night. On the other hand, when you have too many restaurants you crowd all the other uses and I
think that is a problem. So just like in a shopping center one would have a reasonable mix. You
want a little bit of this and a little bit of that and a little bit of this in a shopping center or a
neighborhood center. You don't want one grocery store and two restaurants you want a mixture
of uses in a shopping center or neighborhood center. You similarly want a mix of uses
Downtown. I think that we don't know have the information to be able to make the decision
whether to limit restaurants to 30 percent, 50 percent, 70 percent because we don't have the data.
What I would recommend that we do is in ternlS of limits on Business of Concern is to get that
data. Find out what the uses are in terms of restaurants and what the uses are in terms of other
kinds of retail, and find out what the mixture is in Downtown. That will give us a sort of a better
idea of where we are in that threshold.
One thing that certainly affects the amount of businesses and the kinds of businesses there is
rents. In Palo Alto the rents are considerably higher than in some surrounding areas. Partly the
redevelopment and intensification of uses tends to increase the rents and there is a tradeoff
between rents and what kind of retail can go there. Particularly, as was mentioned, chain stores
can afford to pay higher rents and that can also crowd out local retail uses in some ways. For
example at one point in time Continental Chrome was Downtown and now moved to a side street
where it is a smaller space and the rent is cheaper. So I think we need to understand that a little
bit better to do that.
I do think that we are not actively proposing to kill retail by removing retail protections. Weare
more passively doing it. If we believe totally in market forces then we wouldn't have put the
CUP on housing in RLM districts, where market forces were causing large-scale conversions of
RLM on East Meadow Circle and on West Bayshore and the Hyatt to convert to housing. We
felt that was the pendulum moving too far in one direction. So the idea that market forces
themselves are good enough I think is not necessarily the case. We have seen the economic
downturn we are in is exactly as a result of market forces. So I don't think that in and of itself is
sufficient. We don't want Downtown to become Swiss cheese. I am really pleased that the
landowners are keen on allowing us to eliminate the potential for the use exception. I appreciate
that greatly but I do think that we need to think about what the optimal kind of relationship of
different kinds of businesses there and try to create that for our Downtown for the long-term
health of the Downtown. My understanding before I came here is that when the Stanford
Shopping Center came about Downtown basically died because all the retail traffic went to the
Stanford Shopping Center. That was before my time but I am hoping that we can nurture it back
to health through appropriate and judicious zoning rules. Thank you.
Chair Garber: Commissioner Fineberg, then Lippert, Martinez, Garber, and Holman.
Commissioner Fineberg: The question of how to consider restaurants in the Downtown mix to
me absolutely begs for consideration viewed through the eyes of our Comprehensive Plan. I
have to admit I didn't drag my binder here to the meeting tonight so I can't look down at all the
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policies and programs and see what it says. I do have a copy of the Vision Statements thanks to
Staff because it is going to be the third item on our agenda tonight. I would agree with
Commissioner Keller that we don't have enough information now to determine what the
Comprehensive Plan says and what that mix should be based on prevailing wisdom of what
makes a vital neighborhood retail district.
I want to read though part of the Vision Statement, I am sorry I shouldn't say it is a Vision
Statements it is one of the seven themes of our Comprehensive Plan. It talks about meeting
residential and commercial needs. The last sentence of that theme is, "The City is committed to
retaining existing businesses, nlaintaining vital commercial areas, and attracting quality new
businesses." So if I can construe from that a business district that is 100 percent restaurants is
too much. What that threshold should be less than 100 percent I don't know. I think that is the
question we are trying to answer and we need more information to answer that.
Given that we know that usually once a business has significant tenant improvements and it
won't revert back from being a restaurant, given that we know that if we are trying to build
walkable neighborhoods, if we are adding families in the PTOD districts, if we are adding family
housing near University that is walkable to the train, I would think it is assumed that we need to
have services that would meet the daily needs, the neighborhood serving retail services for those
residents. Things like restaurants. Things like dry cleaners, grocery stores, book stores,
children's clothing stores. There is that whole wonderful mix so that the residents who live there
can walk, that things can be attainable to them within a IS-minute walk. There are needs that go
beyond the restaurants. So I think we need to understand more what that mix would be before
we start either imposing or removing things that would change that mix.
Chair Garber: Thank you. Commissioner Lippert, Martinez, and then Garber.
Commissioner Lippert: I begin by saying that I am not inclined to support putting any
limitations on restaurants. I will begin by saying that restaurants are probably the most intensive
retail uses that you can possibly have. I will back that up with talking about the occupant load
based on the Building Code. For a restaurant it is an occupancy load, which is one per 15 square
feet. A retail load is one per 150 square feet. What they take into account is that you are going
to have merchandise in that store. So from that point of view you have a ten times greater
occupant load with a restaurant use than you do with a standard retail use. Now that is just a rule
of thumb I am using and it is just from the Building Code, but from that point of view in order to
have an economic and viable Downtown you really want to have a lot of bodies there. You want
to have a lot of people, you want to have a lot of activity, and that is what a Downtown is really
all about, having activity on the street.
Mountain View I think is an excellent example. You can walk down that street on a weekend
and you run into people because the sidewalks are so packed. Yes, they are lacking certain retail
functions, but they have one of the most successful brick and mortar bookstores on the peninSUla
in terms of people visiting it. The reason why they have that is because they have a
concentration of people. They also have a used bookstore that is also one of the most successful
brick and mortar used bookstores on the peninSUla. They also have a theater for the performing
arts in their downtown, again another reason for having restaurants is that people can dine and
eat before and after going to the theater. So if you look at downtown Mountain View and Castro
Street as being a negative I wish that we had their problems right now in terms of a critical mass
of people.
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So I don't see any reason to limit the number of restaurants in the Downtown area. I think: it is
like any other retail use. It is something that we need and especially if we want to have a viable
workforce and people working in our Downtown in office space, these people need to eat and the
best thing that we can do is provide them a wealth of wonderful places and not put any
restrictions on that.
In closing, I just want to say one other thing. When I moved to Palo Alto, Palo Alto was not a
destination for restaurants. You went out to dinner, yes you went our for Chinese food, you went
out for some other ethnic foods, but when you thought about it you didn't say oh, I really want to
eat at a wonderful restaurant. You went to San Francisco for that. Today we have some
wonderful restaurants that stand on their own that draw people from other communities here
rather than San Francisco. I am thinking of Junoon, Tamarind, and Chocolat. Those are all
wonderful restaurants. We are also beginning to see them crop up on California Avenue. By
putting a restriction on the number of restaurants we are beginning to say, you know something
Palo Alto isn't thought of as a destination any more in the way of people wanting to come here to
dine.
Chair Garber: Commissioner Martinez, then myself, and then Holman, and then I would like to
move to motions and we can work through them one by one.
Commissioner Martinez: I think we are all feeling kind of intuitively that we are kind of
reaching an upper limit on the number of restaurants. I know we are not in agreement of how
many that should be or if you could ever have too many. I am' sure as Commissioner Lippert
says that Mountain View is a wonderful place for having so many restaurants of so many
different kinds that no matter what kind of mediocre food you want you can find it there.
Palo Alto is different. Despite the nunlber of restaurants, going to Commissioner Fineberg's
point, we are still kind of a mixed retail area lacking in some businesses that provide family
retail. I was struck by the comments about the importance of chain stores. I thought that was a
fascinating insight into sort of what is driving a lot of our local economy. I think there needs to
be a greater emphasis on Gap, Gap Kids, stores of that nature Downtown. That also supports
some of the smaller retail. I don't think it is a time to put limits on restaurants but I think it is a
time to look at what we can do to invigorate the rest of the retail economy. Thank you.
Chair Garber: A couple of comments but let me first, because I did not weigh in on the
University circle conversation. In particular I want to align myselfwith some of the thoughtful
comments that Commissioner Martinez has mentioned. When I look at the map it makes sense
for me for the core protections to extend all the way down to Alma. I think Commissioner
Martinez really hit it on the head in that is the gateway and what really matters there, if I am
understanding his conmlents correctly, is that the expression and the streetscape create an
invitation, a gateway, to the rest of that street. What happens behind that really has far less
impact. This is and will become even more so, more important, hopefully as this whole area is
developed over the next ten to 15 years with the development of Stanford, etc., and will become
a very important entryway as well as linkage to the other side of El Camino. So I think the
comments that talk about how the street and how the city as opposed to what those specific uses
are, which are actually relatively small compared to the overall impact has caused me to think
differently about that.
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Regarding the general marketplace, I have spent a good portion of nly professional life dealing
with very large retail centers and malls, etc. I appreciate the public's comment about retail being
delicate. Getting a retail store into someplace and keeping them there for even three-quarters of
a year to get them going is not an easy thing and requires a tremendous amount of gumption, and
a tremendous amount of luck. The same thing is even more true with restaurants. I think one of
the key things that Palo Alto has going for it is a dramatically different demographic that
supports the retail that occurs along University Avenue than these other communities, certainly
something like Mountain View, to a lesser extent Menlo Park, but certainly nowhere near what
the demographic is for Palo Alto. Mountain View is much more of a destination although there
are residents of Mountain View that would argue with me. The demographic really supports a
lot more than restaurants and that is in large part why we have things, which are not restaurants
there.
I don't think, and I don't think anybody else here believes, that we would every get anywhere
close to 100 percent restaurants. Even if we did, about seven out often of them would die out in
that first year anyway and the luck of trying to get them back into place is pretty low. So I align
myself with Commissioner Tuma's observations. The marketplace structures a tremendous
amount of the activity and the urban vibrancy that occurs on that street despite the way that we
may want to zone it, which is not to say that we shouldn't. I think the concept of strengthening
the core is. spot on and should be rigorously supported by both the business community, which it
sounds like it is, as well as the Planning Staff and this Commission.
It makes sense to me that there is this little wing or fmger that begins to extend down Emerson
and ties that in. I don't necessarily have a sense as to whether it should be - I don't feel it is
necessary that it do that right now. I am really much more interested in focusing on University
Avenue. I really like that area of Palo Alto and it is in large part because the businesses are
small and you end up with all these different storefronts some of which are businesses, some of
which are retail, but seeing that mix and that vibrancy is working now. Knowing that the
ownership along those streets is so cut up into all these individual lots the likelihood of those
being accumulated and that sort of vibrancy going away is pretty low for many years to come.
So I am not as worried about trying to create a statement there and a policy around that just yet.
It is imaginable to me that we could come back and visit that in five or seven years or something
of that sort, but again I think the focus this evening is really around University Avenue.
The last thing I was going to mention is regarding restaurants. Again, I do not believe in the
short-term or the long-term that limiting restaurants is a key issue here. Ifwe suddenly find that
in five year's time the percentage of restaurants is 75 percent of the street or even 40 or 30
percent of the street I would say that there is probably reasonable cause to say what is going on
and we should be doing something there. Given what we have now and the sort of dynamic
environment that we want have where there is going to be a lot of change, and we talk about
dynamism, and the urban experience it is not just people on the street, but it is getting new
retailers on the street. There is a lot of give and play to that. The changing out of retailers
moving be it for rent or for market or because they have outgrown a space and they want to get
into a better marketplace and they take it upon themselves to move into a different marketplace
adds to the vitality and the renewal that has to occur on streets like this, and is I think unique for
Palo Alto, one of the great strengths that we do have a lot of things not just people but also
retailers and businesses moving through the community. So those are just some general
comments.
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Commissioner Holman, you had some final comments and then I propose that we take each one
of the Staff recommendations as a motion and then we can amend it as we go. I would like to do
those as separate motions so that we don't lose ourselves trying to get all the details into one
giant motion. Commissioner Holman.
Commissioner Holman: Yes, maybe three or four comments. I agree that the restaurants are an
important part of a vital shopping district. Commissioner Tuma's comments I absolutely agree
about California Avenue but we are not talking about California Avenue we are talking about
University Avenue.
I think frankly we have gotten either to the tipping point or very close to the tipping point in
Downtown. Restaurants whether they last a year and then trying to get another one in there
might be difficult but nevertheless the capital investment is there. There is an inclination and a
drive to try to get another restaurant there not another use. So that is another thing.
Market forces playa huge force. They are a big force, and a huge part in creating a good retail
sector for any kind of shopping experience. Again, I am a zone for what you want person. We
need to look at what the parameters are within which we want the market forces to operate.
I am going to make one more pitch for the circle there. It is, I agree with our new Commissioner
but I look at that in a little different way. I think that gateway and the continuation of the retail,
and now that we have that parking garage right there it seems all the more reason why retail
would succeed there. So I am not inclined to remove that. I do note also that it is not just a hard
economic time for the business community. We are compassionate about the challenges that the
community is facing. I hope we are also compassionate about the challenges that the City faces.
If you just do simple math, and I don't have the square footages here, but if you just do simple
nlath we are looking to remove 12 properties from the GF and add six. So are we reducing the
amount of retail square footage that we have that will contribute to the City's bottom line?
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Commissioner Keller's comment also about we are not requiring these properties to convert from
retail to office but we are allowing it. The whole reason that the GF zoning was put into place to
begin with was because there was a large movement that was converting ground floor to office.
In a retail section you don't have to have a whole lot of conversions to office before you break
that synergy. The one thing I am disappointed about in the Staff Report is it doesn't really talk
about those synergies and the importance of them, and the connectivity like from Emerson, from
Forest to Hamilton that one block. Yes, there are, Mr. Keenan is absolutely correct and we owe
a lot to Mr. Keenan because he has done a lot of revitalization in this community. That said, I
think there is a great amount of flexibility within the GF zoning allowances service, retail, hotels.
There is a good amount of flexibility there and I think we need to be looking out for the public's
best interest even ahead of looking out for the private property interests, not being unsympathetic
to that in any means.
One thing that I had asked Mr. Williams if we could talk about tonight is I think the City ought
to be, and I am very interested in doing some things for the business community like working to
get the sidewalks clean like Mr. Keenan and I talked about beforehand. I know he is very, very
interested and I have watched it over time. It is one of my big frustrations. Like allowing the
sandwich boards that help promote business. We have now I think just one cross street sign
Downtown that leads people from University Avenue down the side streets. There are a lot of
things we need to do to help the businesses survive and thrive that we are not doing. I did ask
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Mr. Williams to see if we could talk about that a little bit this evening and he said yes. So I hope
we will and this isn't just a matter of putting constraints on property owners. They seem to be
amenable to that but it is also not a quid pro quo swap. We need to be making best land use
decisions in the public's best interests.
Chair Garber: At the suggestion of Commissioner Fineberg let me read Policy B-20, which talks
about the University Avenue Downtown. The Policy states support and enhance the University
AvenuelDowntown area as a vital mixed use area containing retail, personal service, office,
restaurant, and entertainment uses. Recognize the importance of an appropriate retail mix
including small local businesses to the continued vitality of Downtown. Then there are a couple
of sentences of description here. The University Avenue Downtown area is a regional retail and
entertainment attraction, and a professional office and service commercial center for Palo Alto.
Its historic buildings, architectural variety, and public improvements contribute to its economic
success. In the past the City has taken steps to maintain the area's strong retail function by
limiting the amount of first floor office space. To protect the area's scale and character the total
amount of nonresidential floor space allowed is also regulated.
So Commissioners, let's take these, and I apologize that this has gone on longer than we had
hoped here. Let us work through potentially four motions here. We will take the first two
recommendations as motions one and two, and then we will do the last recommendation the
Limits on Businesses of Concern as motion number three. Then motion number four will be the
recommended revisions to the zoning map and I am putting that last only because I think there
will be the most amount of discussion around that particular piece.
May I ask the Vice-Chair to make the motion here?
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MOTION
Vice-Chair Tuma: Sure. Move that the Planning and Transportation Commission follow the
Staff recommendation with respect to changes to the Ground Floor Combining District
regulations, removal ofPAMC Section 18.30(C).040.
SECOND
Commissioner Keller: Second.
Chair Garber: The motion is seconded by Commissioner Keller. Any discussion by the maker?
Vice-Chair Tuma: No.
Chair Garber: The seconder?
Commissioner Keller: No.
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MOTION PASSED (7-0-0-0)
Chair Garber: All those in favor of the motion say aye. (ayes) All those opposed? That motion
passes unanimously.
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Commissioner Tuma, a motion on number two?
Vice-Chair Tuma: Sure. Move the Planning and Transportation Commission recommend the
Staff recommendation for removal ofPAMC Section 18.18.060(:t)(1).
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SECOND
MOTION
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Chair Garber: I will second the motion. Any discussion by the maker?
Chair Garber: None by the seconder. Any discussions by Con1ll1issioners? Commissioner
Keller and then HolnlaJ.l.
Commissioner Keller: I think that it makes sense to have some flexibility on CD-C but not
complete decontrol. In particular with respect to the potential for taking some of the green
parcels, namely the ones that are being rezoned from what is now nlandatory retail to no control
on that, the combination of those is particularly problematic.
It seems to me that the City can do things to enhance retail. The biggest thing the City can do to
enhance retail is to fix the permit process. I have heard from a lot of retailers and potential
retailers the process for getting permits out of our Development Office is worse than pulling
teeth and getting a root canal on the other ones. In particular I have heard before a lot of the
collapse of retail on Bryant that they wished that there was more lighting on Bryant. So before
we go through the process of allowing decontrol on that, complete decontrol, I think we should
take particular measures to figure out what we can do to strengthen the retail in this district at the
times when the economy does come back. In particular that we provide some flexibility in
particular in things that have not historically been retail to allow experimentation without it being
a one-way ratchet. Thank: you.
Chair Garber: Are those just general comments or was there an amendment that you were
proposing?
SUBSTITUTE MOTION
Commissioner Keller: Well, if I were to make a motion what I would recommend is to amend
Section 18.18.060(:t)(1) in such a way that existing retail uses have to stay as retail uses and new
retail uses can revert back to non-retail. That is something that I would float as a trial balloon as
a companson.
Perhaps I should make that as a substitute motion that existing retail uses according to Section
18. 18.060(:t)(1 ) stay as retail and new uses that are converted to retail could become retail and
revert back.
Chair Garber: Is there a second to the substitute motion? I am seeing none. That motion dies.
Is there any further discussion on the primary motion? Commissioner Holman.
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Commissioner Holman: Just kind ofa reiteration of what I stated before about removal of the
restrictions and working towards the City's and publics best interest. So it is comments I have
already made before.
Commissioner Keller: Are you going to make a motion?
Commissioner Holman: Well, I think the way that we could go is a substitute motion would just
be the counter of this.
Commissioner Keller: I am wondering if you would simply not want any changes or if you
would allow some sort of flexibility?
Commissioner Holman: It is easier I think if we can point to locations on the map that you
would be referring to in terms of flexibility. I think that would be helpful.
SUBSTITUTE MOTION
Commissioner Keller: What I am simply saying is that things that are currently retail would stay
as retail that is what my substitute motion was, and things that are not currently retail which are
not covered by the restrictions on retail could experimentally be placed as retail, and if it didn't
work out it could revert back to office. So that was my motion because there were comments by
the Staff and by some members of the public that they were unwilling to convert existing office
uses to retail uses and have it forever stay as retail if it did work that way. That was what I was
proposing.
Chair Garber: Commissioners, I need you to either nlake an amendment, a substitute motion, or
otherwise we shouldn't be discussing.
SECOND
Commissioner Holman: I will second that. There is a little discomfort with that though because
there is no City Attorney here to comment on if we can kind of do this mish-mash. I will second
the motion and see what happens.
I do have one comment that actually plays into this that I meant to ask earlier and apologize that
this didn't come at actually the appropriate time. In the Staffpresentation .....
Chair Garber: Actually, if I may if ....
Commissioner Holman: It is very relevant to this motion.
Chair Garber: Okay, so you would be seconding the Substitute Motion so I will remove the fact
that I said it had died. Weare moving on and the speaker therefore has no comments but the
seconder does.
Commissioner Holman: I do, again with the caveat that I don't know what the City Attorney
would say about that. The other thing is I am a little concerned because in the Staff presentation
there was a comment that said that there would be additional outreach after the Planning and
Transportation Commission meeting. Apologies to everybody, I did mean to ask this question
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earlier because is that going to be as a result of our actions, and so we are not going to have
feedback on that, and then it is going to go to Council based on the outreach comments? What is
the purpose of that? It seems like all of that outreach should have happened before the Planning
Commission meeting unless I am missing something.
Ms. Cutler: I believe the goal of further outreach between now and the City Council meeting
would be to make sure that all of the affected members of the Downtown are aware of what the
Planning Commission's final recollunendation to the Council is. So if there are changes from
what Staff had been discussing that they are aware of that and able to speak to Council about
that.
Commissioner Holman: Thank you for that clarification.
Chair Garber: Discussion from the Commissioners. Comnlissioner Tuma, did you have a
comment relative to the planners? Okay. Commissioner Keller.
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Commissioner Keller: One comment with respect to outreach to the pUblic. I believe that there
was a member of the public who pointed out that there was not sufficient outreach to the
business owners of the parcels that were being rezoned from the mandatory GF. I realize that is
not part of this motion but I believe that one member of the public had made that comment. I am
not sure how much outreach was made in terms of the people who are business owners in the
non-GF portion that are retail for which they might be at risk for raising rents at some point in
time and losing that as a retail use.
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Chair Garber: Commissioner Fineberg and Martinez and then we will call the question.
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Commissioner Fineberg: I support the substitute motion because I think it honors the goals of
the Comprehensive Plan to retain mixed use and a diverse amount of varied businesses
Downtown. It protects the existing retail, which is in place but then provides the flexibility for
the areas to have that two-way ratchet if they are currently office space. I think it also honors the
goals that City Council has had of preserving retail.
Commissioner Martinez: I have a question about the substitute motion. Arthur what do you
mean when you say retail will stay retail?
Commissioner Keller: What I mean is that the provisions of Section 18.18.060(f)(1) apply only
to those parcels for which the provisions now apply.
Chair Garber: If you would give us an example.
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Commissioner Keller: Basically my understanding of this Section is that there are some parcels'
within the CD-C District, non-GF portion, which have retail uses now on the ground floor.
According to this provision those uses require that they remain retail. If the motion as originally
proposed, to which I am making a substitute motion, if that motion is passed then those parcels
could become non-retail use, could become office use. There was at least one member of the
public who .said that he has chosen not to take an office use and experiment with the retail use
because he has been concerned that if he did that it would have to stay office, it would be
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ratcheted in one direction. So I am basically limiting the 18.18.060(f)(1) only to apply to those
uses that are currently forced to remain retail and to allow experimentation on the uses that are
not currently retail, to allow the offices use to become retail and to revert back, back and forth at
will.
Chair Garber: So, Commissioner Keller if I understand you correctly, and forgive me
Commissioner Martinez the properties, which are currently brown or orange up there, would
remain retail.
Commissioner Keller: No, I am refeni.ng to the yellow properties. We are talking about the
yellow properties for CD-C. The brown properties are CD-C with GF. So the yellow properties
currently are partially retail and partially non-retail. Anything that is retail now under this
current ordinance has to stay as retail and anything that is not retail if it becomes retail it ratchets
and stays as retail from now on. What I am simply saying is I am freezing it so that those things
that are forced to be retail now remain as retail and anything in the future that becomes retail that
is currently non-retail doesn't have to stay retail and can go back and forth.
Chair Garber: Let's see if Commissioner Martinez is satisfied with his question.
Commissioner Martinez: Yes, I think I get it.
Chair Garber: Commissioner Lippert.
Commissioner Lippert: The only concern I have is that what you have described, and I think
Commissioner Holman hit on is I think there might be some legal issues which could represent a
taking in that you have one zone and two disparate policies in terms of how to interpret that
zone. That runs into legal land use questions.
Chair Garber: Planning Director, forgive me and welcome back. Thank you for your ping-pong
game. Weare in the midst of a question here which I don't think you were in the room to hear
the beginning of. We are taking each of the recommendations bullet by bullet and making
motions around them. There was a motion made to support the Staff recommendation to change
the Downtown Commercial District regulations, bullet point nUlTlber two. A substitute motion
was made to create a - how would you describe it Commissioner Keller? The yellow properties
if they currently are occupied by retail they would have to remain retail. If they are not occupied
by retail they could be changed to retail but then would have to remain retail.
Commissioner Keller: The current ordinance if they are changed to retail they have to remain
retail forever. Under my proposal places that are not retail that become retail in the existing
building those could revert back. However existing retail uses have to remain as retail. In other
words, essentially what would happen is that certain sections would have a date of March 19,
2001 through some date in 2009 when the ordinance took effect.
Chair Garber: Essentially you would have a map where the yellow is and there would be some
of the brown or orange inside that yellow.
Commissioner Keller: No it wouldn't be brown or orange because it wouldn't have the GF
designation by zoning. It would have the GF designation. by continuation of the current
restriction. Therefore we are not taking from the current property owners because it is already
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GF. We are simply allowing new properties that do not have the GF restriction to not have to
have it in the future.
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Conm1issioner Lippert: My point is that you are giving property rights to one group but not the
other.
Chair Garber: Planning Director, any advice for the Commissioners?
Mr. Williams: I don't think: there is a legal reason you can't make that distinction. I think: it is a
little bit of a bookkeeping thing for us to keep a record of what is retail now. It wouldn't be our
recommendation that you go there but that is obviously the Commission's determination. The
reason we wouldn't recommend it is we have talked about some properties that currently are in
that yellow area, they are retail, but we don't think: it makes a lot of sense to require them to
remain retail, or at least not to the extent that they are already. So do you really want to do that
and just give the flexibility to the new ones but that is your call.
Vice-Chair Tuma: Commissioner Tuma.
Vice-Chair Tuma: To me this is completely arbitrary. We are picking this time because this
happens to be - we are not doing this based on a policy that we are trying to effectuate. Weare
doing this because well, as of right now those are in and those are out. It just seems completely
arbitrary to me.
The other thing is having the flexibility in these outlying buildings, having a good vibrant
Downtown is partly having enough office space and whether that is ground floor or not when
you are outside of the core CD-C seems to me to be good policy. Again I go back to the
marketplace will help this area resolve that. These are feeder areas. So the substitute motion to
me just doesn't fundanlentally the problem I have with it is it just seem arbitrary. Those that
are in now are in, those that aren't aren't, and that just seem inappropriate.
Chair Garber: Just before I go to Commissioners Keller, Holman, and Lippert I will likely not
support the substitute motion only because I believe that again the focus should be on University
Avenue and anchoring that ground floor retail there, and to ,allow these sort of bits and pieces to
exist outside of that doesn't support the overall concept of trying to focus our energies on
University Avenue, it still allows these other occupancies to use but if there is greater diversity
and change in those I think: that is fme. That is the way that those zones should work.
Commissioner Keller.
Commissioner Keller: So I notice that Planning Director had specified that he was' aware of
some properties that are currently retail for which retail doesn't make as much sense. I am
wondering if it would help the discussion if you could cite a property without being problematic.
Mr. Williams: The one we have cited before is Spago at 265 'Lytton property, a very large space
that has worked sometimes as a restaurant. It is probably maybe the only thing it could work as
given the way it is configured. It has been vacant for some time. There is a small retail taking
up a small part of that right now. It is out at the mid-block on Lytton where there just really is
not the kind of foot traffic to support that and that is why a Stars or Spago or something has to be
a destination that goes there. So it could sit vacant for a long time. So some of these at the
periphery like that mid-block on Lytton or Hamilton, the sort of far reaches it seems counter
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productive to require them just because they have most recently been retail to remain forever in
that designation.
Commissioner Keller: So let me just quickly say that here we are allowing retail to become nonretail perhaps by neglect if you will, allowing them to have anything. At least this is much better
than what the City deliberately did 20-some years ago where the City prior to my involvement
deliberately killed retail in South El Camino Real and forced it to become housing. So this is not
nearly as bad but I am wondering if some Planning Conlmissioner 20 years hence might wish we
hadn't done this sinli1arly.
Chair Garber: Well, every new Planning Commissioner is smarter than all the others by
definition. Commissioner Holman and then Lippert and then let's get to the question.
Commissioner Holman: I am actually going to remove my second but I sort of wish that this
topic and the next one were considered together because I do have comments and suggestions on
the GF where it goes and where it doesn't go. So I really think these go hand in glove but I think
this one as a standalone motion doesn't have the merit that I would hope that it might.
Chair Garber: Okay. In that case if Commissioner Lippert will allow let me call the question of
the primary motion, which is supporting the Staff s recommendation.
Commissioner Holman: Excuse me but for me these go hand in glove. I am not going to be able
to vote up or down on this without also having the consideration of the next bullet point. They
go absolutely hand in glove.
Chair Garber: The next bullet point being the zoning map or the order that I had suggested
which is that we go to Recommended Limits on Businesses of Concern?
Commissioner Holman: The zoning map. Sorry, but I am sure you can understand why.
Chair Garber: So let me see if I am understanding what you are suggesting the Commission do
here. To no longer support the substitute motion but create another substitute motion where we well we could do it that way too but what I anl hearing is there is a substitute motion to say let us
consider Staff recommendations bullets number two and three together.
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Commissioner Holman: That is correct. It could be a series of amendments it doesn't have to be
a substitute motion. It could be a series of amendments either to the main motion or independent
amendments, or we could table the current motion. There are a number of ways to address it.
The reason being depending on what we do with the zoning map is going to absolutely determine
what I do in regard to the current motion.
Chair Garber: So let's just table the motion. Do you think we can get through the Limits of
Businesses of Concern topic and then go to the zoning map topic? My recommendation is that
we create a motion supporting the Staff s recommendation here and then take an inlmediate vote
on that to just see if we can get through that.
Commissioner Lippert: I call the question. I have called the question you have to do it.
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Commissioner Keller: Actually sir, calling the question requires a vote and tabling is priority
over calling the question. I move to table.
Commissioner Lippert: But we have a main motion and I was recognized to speak after
Commissioner Holman and you were not.
Chair Garber: Okay, now I am completely confused. Any help, Mr. Planning Director?
Mr. Williams: I think you should either vote on the main motion or vote to table. I think the
result is the same way, I assume it is going to reflect the same position. If there is a majority of
you that is not supportive of the substitute motion right now then that majority would vote to
table if you vote on tabling. Ifnot, then I don't know I just see it coming out the same way. So
whichever vote you take first but I do think it is appropriate to vote on either the motion or
tabling. I think that is the Chair's prerogative as far as who was first in line.
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Chair Garber: Okay. I think that what we should do is go back to the primary motion and either
get that up or out and then we will move forward from there.
So without further comment.
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Commissioner Keller: You can't. I object.
Chair Garber: Planning Director ...
Commissioner Keller: According to Robert's Rules of Order ....
Chair Garber: Which we do not follow.
Commissioner Keller: Calling the question is a motion that requires a vote and it is not simply
an un-voted motion.
Chair Garber: Okay, rather than debating the issue. All those in favor of calling the question to
the original motions, all those in favor of supporting an immediate vote say aye. (ayes)
Opposed? (nay) That passes four to three.
Mr. Williams: Now you vote on the motion.
MOTION PASSED (4-3-0-0, Commissioners Holman, Keller, and Fineberg against)
Chair Garber: The primary motion. So let's vote on the primary motion which is to support
Staff's recommendation that removes PAMC Section 18.18.060(f)(1) so that the loss of
flexibility of ground floor uses in the downtown core covered by the GF Combining District will
be balanced by an increase in flexibility for ground floor uses in the periphery of the Downtown.
All those in favor say aye. (ayes) All those opposed? (nays) The motion passes four to three
with Commissioners Martinez, Garber, Tuma, and Lippert supporting it and Commissioners
Holman, Keller, and Fineberg not supporting it.
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MOTION
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Okay, we will go to a motion that supports the Staffreconunendation on Limits of Business of
Concern. Do I hear a second to that motion?
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SECOND
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Vice-Chair Tuma: Second.
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Chair Garber: Seconded by Commissioner Tuma. The maker has no comments. Does the
seconder?
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Chair Garber: None. Is there discussion regarding this? Commissioner Holman and then
Keller.
Commissioner Holman: I really ask Commissioners to consider what the consequence of this is
and what the consequence is to the City and the public. So what we just did by majority vote
was say that existing retail that is required to remain in place can convert to non-income
producing, non-retail use. If we also take out 12 properties and add but six we are further
exacerbating the loss of retail generating properties to the City. Am I not understanding the
motion?
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Chair Garber: We are talking about bullet point number four as opposed to the map, restaurants
primarily.
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Commissioner Holman: Oh, I am sorry. I thought you were looking at bullet point number
three. My apologies. Skipped one on me.
Chair Garber: I apologize. Are there comments regarding? Commissioner Keller.
Commissioner Keller: Briefly. I am going to support this motion just because we don't have
any time to deal with this. I believe that the proper time for dealing with this is when we are
doing the Comprehensive PIal.} Update, when we are talking about retail mixes and we are
talking about retail in general. That is the proper venue and I hope we get the data back that I
have requested one that so we can do the appropriate analysis at that time.
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Chair Garber: So noted. Any other discussion? Commissioner Holman.
Commissioner Holman: If I might, Ms. French do you know if we are going to have opportunity
to address this under the Zoning Ordinance Update? The primary focus has not been Downtown.
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Ms. Amy French, Current Planning Manager: We are done with the Zoning Ordinance Update.
Do you mean the Comprehensive Plan?
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Commissioner Holman: I am sorry, the Comprehensive Plan Update, yes.
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Ms. French: I thought I saw Julie blow through here and maybe she is on her way back, I don't
know. So I don't know the answer to that. Could somebody just state what the actual motion is
about, it is something about business restaurants, that one?
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Vice-Chair Tuma: Yes, the motion I believe was to adopt the Staff recommendation to make no
changes to the limits on specific businesses of concern.
Ms. French: Thanks, that's great for the record.
Chair Garber: With that let us ....
Commissioner Holman: I am going to oppose the motion because I don't know that we can
address this during the Conlprehensive Plan Update. I have no information that indicates we will
be able to and I think it is something that needs more study. So sorry.
Chair Garber: Commissioner Fineberg.
Commissioner Fineberg: In preparing for tonight's nleeting I renlember reading something that
amendments to the Comprehensive Plan can be initiated at any time by the Planning
Commission, I believe it was Staff, or project applicants. So is there a mechanism that we can
bring this back on our agenda whether it be concurrent with the Comprehensive Plan Update or
in advance of it or after it so that it as an item can get the consideration that it warrants? The
answer to that would influence how I would vote on this.
Chair Garber: If I may prompt Staff there just happens to be on November 18, under Future
Agenda Items, a review of business and economics chapter in the Comprehensive Plan.
Ms. French: That looks promising.
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Chair Garber: Thank you for your optimism. Commissioner Fineberg, does that help. you?
Commissioner Fineberg: Yes it does and I think we can satisfy our needs then.
Chair Garber: Commissioner Holman.
Commissioner Holman: With that assurance I can support the nl0tion.
Chair Garber: All those in favor of the motion as stated say aye. (ayes) All those opposed?
That motion passes unanimously.
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Let us go to bullet point number three. Let us first state the motion. Conlmissioner Keller.
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MOTION
Commissioner Keller: I move the third bullet of the third item, which is added GF protections to
the existing retail on the south side of the strongest block of retail on Hamilton Avenue (the 200
block between Emerson Street and Ramona Street) and to the Aquarius Theater and the two
restaurant sites inlmediately to the north on Emerson. That is a single motion separate from any
other thing we consider on this item.
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SECOND
Vice-Chair Tuma: Second
Chair Garber: Would the maker like to speak to their motion?
Commissioner Keller: I think that this is a clear area where retail is certainly contiguous with
existing retail and it certainly strengthens to add GF protection to these identified parcels that
Staff recommends.
Chair Garber: Seconder?
Chair Garber: Discussion?
Commissioner Holman: Could the motion please be restated? I am sorry.
Commissioner Keller: The motion is if you look at Staff recommendation on the Zoning Map I
am making the revision to the PAMC Section 18.08.040 to add the properties that are listed on
the third bullet, added GF protection to that whole section, that whole paragraph. That is it for
this motion. It is just the entire third bullet of this. I am not doing deletions. I am not doing the
no changes at this time.
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Chair Garber: Does that help? I see no lights for discussion. All those in favor of the motion as
stated say aye. (ayes) All opposed? The motion passes unanimously, thank you.
May I have another motion for the remainder or some portion of the remainder?
MOTION
Commissioner Keller: I am going to make the motion that we make no further changes, no
removals, and no further changes to the Zoning Map at this time.
SECOND
Commissioner Lippert: I will second that.
Chair Garber: Would the maker like to speak to their motion?
Commissioner Keller: I think in particular with the way that the second motion went earlier
tonight that this is not the time to remove controls on these parcels. If the second motion had
gone differently I might have felt differently but not under these circumstances.
Chair Garber: The seconder?
Commissioner Lippert: I don't need to say anything.
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Chair Garber: I see a light from Commissioner Holman. Commissioner Holman.
Commissioner Holman: I would like to add a friendly amendment to the motion, hopefully a
friendly amendment to the motion to continue Emerson from Hamilton to Forest both sides of
the street. There are a couple of other places but I would like to add those as an initial thought.
Commissioner Keller: Let me restrict my motion simply to not recommending the first two
removals and let Commissioner Holman's proposals be separately voted on, is that okay?
Chair Garber: Okay, so that does not limit Commissioner Holman from making motions to make
other additions separately.
Commissioner Keller: Yes that is correct.
AMENDMENT (SUBSTITUTE MOTION)
Commissioner Holman: So I will make a separate amendment motion to add ....
Chair Garber: This would be a substitute motion.
Commissioner Holman: No it is a separate amendment to the motion.
Chair Garber: I see, thank you.
Commissioner Holman: To add Emerson between Hamilton and Forest to connect the South of
Forest Avenue area and the Downtown GF District to be protected by the GF zone.
Commissioner Keller: May I inquire whether you are also referring to -- there are some
residential or non-retail properties along there, are you including those? On the logical east side
of Emerson.
Commissioner Holman: There is a combination of uses. Again this doesn't require that they
change.
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SECOND
Commissioner Keller: Okay, well I will accept your amendment.
Chair Garber: Seconder?
Commissioner Lippert: No.
Ms. Cutler: May I ask for clarification?
Chair Garber: Yes.
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Ms. Cutler: I would like to clarify that you mean both sides of the street along that entire block.
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Commissioner Holman: Yes.
Ms. Cutler: Thank you.
Chair Garber: I believe that is understood by the maker and seconder as well. So that
amendment fails unless you make it a substitute motion.
Commissioner Holman: It is an amendment as a separate nlotion. I believe Commissioner
Keller seconded it. It is a motion.
Chair Garber: You were offering it as?
Commissioner Holman: As a separate amendment motion.
Commissioner Lippert: Excuse me the first time around she was making a friendly amendment.
I was not accepting it. The second time she was making it a formal amendment where we would
have to vote on it.
Commissioner Holman: So I already made the motion and I believe there was a second.
Commissioner Keller: I am seconding it.
Chair Garber: Okay. Commissioner Holman would you like to speak to your motion?
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Ms. French: I have to step in because there is no attorney here. We have not advertised this
portion of the map as proposed changes so I am a little bit concerned if we are adding tonight.
The first motion was that no further map changes would be added and now it is a substitute
motion saying oh yes, further map changes are being made and these are not ones that we had
put forward tonight.
Chair Garber: Commissioner Tuma.
Vice-Chair Tuma: We can't do this. This has not been noticed. These owners, these business
members have no idea this is going on. I just don't see how we could just throw this into the
mIx.
Commissioner Lippert: We would need to initiate first and notice that this was going to happen
and then we would have to have a formal hearing on it. That is my reason for saying no to the
amendment. I should have spoken up.
Chair Garber: Commissioner Keller.
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Commissioner Keller: I appreciate the Commission's predicament that we are in. Unfortunately
the motion that we made number two where we removed retail protection from there that
essentially removed retail protection from a large swath, which is much too broad and that is
why I was opposed to that. I realize that as a losing party to the second motion if we were to
limit that geographically so that the removal did not apply to these parcels along Emerson then
we wouldn't need this motion. But because the second motion essentially eliminated all
protection to Emerson, a thriving retail district that connects with the retail district in SOFA this
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is problematic. So if somebody on the prevailing side would move for reconsideration on the
second motion so that we could amend it to eliminate that we wouldn't have this problem.
Chair Garber: Let's not make it more complex than it is. Commissioner Holman.
Commissioner Holman: This shouldn't be this hard. The Commission is very challenged
because we don't have legal representation, which is exceedingly frustrating. I am prone to say,
and I don't know if this is legally allowed either, is that we move the first motion. Somebody on
the prevailing side retract the second motion and we continue the whole rest of this until another
meeting when we can have proper legal representation and authority.
What I recall from past is because this is a recommending body, what I recall Attorney saying is
that we aren't restricted to exactly what was noticed because it is a recommending body. If we
were the City Council then it absolutely would not be allowed. Again, I am going from memory.
I am not the attorney. So I think if we could just get off the dime and move the first motion
forward and continue the rest of it to a date certain when we can have proper legal guidance I
would be most comfortable with that. Sorry for the challenges but we are in the situation that we
are in and it is most unfortunate.
Chair Garber: Commissioners? Full stop is what I am hearing.
Commissioner Lippert: I am going to call the question.
Vice-Chair Tuma: I think you are hearing none of the Commissioners on the prevailing side are
willing to reopen those motions.
Chair Garber: That is true. I am uncertain at the moment what question is actually on the table
to be voted on. Thank you. Wouldn't you know it would be the one evening that our attorney is
not here?
Ms. French: I have to agree with Commissioner Holman that I don't think it is absolutely illegal
because as she says it is a recommending body. So you certainly can do what you would like to
that extent because it is not an actionable legislative act. However, we have done a certain
amount of outreach and we are going to be doing more I guess. Do you want to weigh in? Julie
is here to weigh in.
Chair Garber: So Commissioners let's do this let's take action on the motion that Commissioner
Holman has posited, the amendment. Then let's see if we can move forward as best we can.
Commissioner Holman: I have one question I apologize, like I said this really shouldn't be this
hard. Was there no discussion at all at that the Commission might do something different than
what the Staff recommendation is or what the discussions were? We do have that purview. We
do have that possibility. So was there no discussion that the outcome might be different than
what is recommended here?
Ms. French: In the outreach meetings there was discussion about Emerson as a possibility and
through those outreach discussions it seemed that things were just fine on Emerson so Staff did
not recommend it. It had been brought up as a possibility in the outreach sessions. It just is not
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identified as a Staff recommendation so I think you can make statements and see where your
motion goes.
Ms. Julie Caporgno, Chief Planning and Transportation Official: I haven't been involved with
this that much but my understanding is that you would be able to make a recommendation on
anything within the area that you currently looked at in conjunction with this. Now if you are
expanding beyond that area then you would have a problem. I think Staff would not be
supportive even if it is legally possible to proceed with something that wasn't noticed that was
outside the area I think for disclosure purposes and to make sure that there was an appropriate
public process we would definitely encourage you to come back and revisit that at a subsequent
meeting if it is beyond the scope of the area that was identified.
Ms. French: Technically it is not beyond the scope because it is in the CD-C. We are not
beyond the yellow. If we were beyond the yellow we would have real problenls.
Chair Garber: Okay. So the question has been called let us vote. All those in favor of the
amendment as stated, and forgive me would you please just restate the content of that?
Commissioner Holman: The GF Zoning District be extended on Emerson between Hamilton and
Forest.
Commissioner Keller: Just so we don't have a problem, I assume you are referring to the portion
ofCD-C that is between Hamilton and Forest, and excludes the property on the comer of Forest
and Emerson that is not part of the CD-C currently. In other words, we are restricting it to
yellow. The portion of which Congresswonlan Anna Eshoo's office is in is not part ofCD-C as
far as I can tell from the map.
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Commissioner Lippert: That property is a PC.
Commissioner Holman: I think that is a PC so that is fine.
Commissioner Keller: Thank you.
MOTION PASSED (4-3-0-0, Commissioners Garber, Tuma, and Lippert opposed)
Chair Garber: All those in favor of the motion as stated say aye. (ayes) All those opposed?
(nays) That motion passes with Commissioners Holman, Martinez, Keller, and Fineberg
supporting the motion and Commissioners Garber, Tuma, and Lippert not supporting it.
Ms. French: Who seconded that? We are trying to keep track.
Chair Garber: Commissioner Keller. Okay, we are back to the main motion, which had been
attempted by Commissioner Keller. Would the Commissioner like to try that again?
Commissioner Keller: Is this the add voting?
Chair Garber: This would be the add voting, yes.
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Commissioner Keller: So then it is the adds that we are doing I think. We didn't vote on the
adds yet. Sorry, we voted on the adds already that was unanimous. I think what we are voting
on is the removals.
Chair Garber: You are right it is the removals.
Commissioner Keller: This is the no removals and the only change is Emerson between the CDC between Forest and Hamilton.
Ms. French: I am sorry to interrupt this might be out of order. Can we just make sure there is
focus? The three miscellaneous non-retail parcels, they are not retail now, on Kipling and
Cowper north of University. They are kind of out there on their own. You are saying you are
not interested in touching those.
Commissioner Keller: We are not touching those at this time.
Chair Garber: Do I hear a second to that motion? I'm sorry that is already in place~ Remind me
who actually did second that.
Commissioner Lippert: I seconded it but then they amended it.
Chair Garber: Okay, so' I am assuming that speaker that made the motion has nothing more to
say. The seconder?
Commissioner Lippert: I am not going to be supporting the nlotion because I was not in support
of the amendment. You can't withdraw the second so I am just not going to support it. I am just
not going to vote in support of the motion.
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Commissioner Holman: I will second then.
Commissioner Lippert: No. I have already seconded it. You can vote on it I am just not going
to be supporting it.
Chair Garber: He is just not going to be supporting it.
Commissioner Holman: I thought you were withdrawing your second. I apologize.
Chair Garber: No. So is there discussion by the Commissioners? Commissioner Fineberg.
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Commissioner Fineberg: One issue that was just brought up that I don't know if it is going to
warrant a friendly amendment and maybe I will know from a show of smiles or thumbs down.
The question of whether we need to deal with whether any of these amendments apply to PCs.
We just talked about that one particular parcel. In our previous study session there had been
comments about whether we should address PC so that if they were ever redeveloped whether
the GF would apply to those PCs. I think if we do not do a friendly amendment now or a
substitute amendment then we will be deciding that PCs stay off on their own with no coverage
with the GF overlay. So how do we sort of thumbs up or thumbs down that?
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Chair Garber: Commissioner Tuma.
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Vice-Chair Tuma: My recollection is that the discussion and the feedback that we had from the
Planning Director was that PC is its own zone with its own zoning and it has its own parameters.
So if you are going to change anything there that PC would have to be revisited so there would
be essentially no effect whatsoever about having this overlay on it or not. I am not even sure that
you could do it but even if you did it wouldn't change it because the zoning is its own legislation,
its own PC, and has its own parameters.
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Ms. French: Yes, I believe that you would have to individually each separate parcel, parcel-byparcel, go to add such a PC-GF legislatively. You could not do it blanket all PCs shall have or
all PCs in this area shall have.
Commissioner Fineberg: I will take that then as an absolute thumbs down on considering that at
this time and I would support the motion.
Chair Garber: Conunissioner Martinez.
Commissioner Martinez: I just wanted us to restate the motion.
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Comnlissioner Keller: The motion is with respect to the Staff recommended revisions of the
zoning map we are not doing the first bullet removal, we are not doing the second bullet
removal, we are not doing the fourth bullet removals, we are not making changes with respect to
the last two bullets, however we are adding the CD-C portions of Emerson between Forest and
Hamilton are being added to the GF Overlay protection.
Ms. French: Both sides of the street.
Commissioner Keller: Both sides of the street with the exception of the PC portion that is not
currently CD-C.
Chair Garber: May I ask Staff to take the laser pointer and point to these areas?
Ms. Cutler: Let's see, the first bullet point is removal ofGF from properties along Alma and
portions of High Street near Hamilton so that is down here, which we are not doing according to
the current motion. The second bullet point is removal of GF protection from properties along
the circle ramps connecting University Avenue and Alma Street, which is here, which again
based on the current motion I believe you are not proposing. Bullet point four we skip down to
the three miscellaneous properties that are not retail currently but are currently in the GF zone
the current nlotion proposes to leave them as they are in the GF zone. Number five is that no
changes would be made to University Avenue east of Cowper Street so that is these properties
here, and the motion I believe is to go with that recommendation and not make any changes
there. Bullet point number six is no changes to Bryant Street between University Avenue and
Hamilton, which is right here this block, and I believe the motion currently on the table is to
leave that as it is in the GF zone.
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The amendment I believe was to take the block of Emerson between Hamilton and Forest on
both sides of the street where it is yellow in this picture in the CD-C and add those to the GF.
MOTION FAILS (3-4-0-0, Commissioners Martinez, Garber, Tuma, and Lippert opposed)
Chair Garber: Thank you. With that let's call the question. All those in favor of the motion as
stated say aye. (ayes) All those opposed? (nays) That motion fails with Commissioners
Martinez, Garber, Tuma, and Lippert opposed and Comnlissioners Holman, Keller, and Fineberg
supporting the motion.
So let me just ask the Commissioners if there is any other discussion or motion that needs to be
added to this particular item. Commissioners Tuma, Keller, and Holman.
MOTION
Vice-Chair Tuma: Okay. I am going to make a motion that with respect to bullet points five and
six, the no changes to University Avenue east of Cowper and no changes to Bryant between
University and Hamilton.
SECOND
Chair Garber: I will second that. Would the maker like to speak to their motion?
Vice-Chair Tuma: What I am trying to do here is knock off items that I think we have violent
agreement on. Those two bullet points seem to fall into that category. My sense is that at least
the vast majority of the Commission is fine with that and I just want to try to knock those off.
Chair Garber: Commissioner Holman? Okay. All those in favor of the motion as stated say aye.
(ayes) All those opposed? The motion passes unanimously.
Commissioner Holman. I apologize Commissioner Holman. Con1missioner Keller was ahead of
you. Commissioner Keller. Commissioner Keller is giving you precedence Commissioner
Holman.
Commissioner Holman: There are other things I would like to do but I think out of frustration I
shan't. I don't want to let the opportunity pass without mentioning that this Commission I hope
would support expeditious activities on the part of the City and the City Staff to work with
property owners to make improvenlents such as an improvement to the I know actually that the
City Manager is looking at and working towards getting rid of the multi-tentacled process for
approvals and looking at improvements to the Downtown Business District including signage,
cleaning the sidewalks and such. So I am hoping the Commissioners would help support
Council in directing improvements in that area to support the business districts including plaques
and sandwich boards.
Chair Garber: So your recommendation here is not necessarily to make it a motion but we can
make that something that we ask Staff to revisit and we can agendize that separately.
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Commissioner Holman: Absolutely. If we could have a straw poll. It is not a motion because it
is not before us as an action but again Mr. Williams, Planning Director, did say that we could
comnlent on that this evening.
Chair Garber: Okay. I am happy to do a straw poll. Are the Commissioners in favor of asking
Staff to agendize that item for a discussion at a later time? Seeing nods around the table.
Commissioner Keller and then Tuma.
Commissioner Keller: I would like that to be done particularly if there were size limitations.
There are some sandwich boards off of Downtown that I noticed that are overly large,
particularly one on Alma Street.
MOTION
I move that we do not do bullets one, two, and four of the Staff recommended provisions of the
zoning map.
Chair Garber: Do I hear a second for that?
SECOND
Commissioner Lippert: I will second that.
Commissioner Fineberg: Point of clarification. What do you mean by do not do? The opposite
of what is stated?
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Conlmissioner Keller: We do not accept Staff recommendation for the removal of GF protection
on any of the parcels that has recommended.
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Chair Garber: Bullet points one, two, and four.
Commissioner Lippert: I will support that.
Chair Garber: That is seconded by Commissioner Lippert. Would the maker like to speak to
their motion?
Commissioner Keller: No.
MOTION PASSED (4-3-0-0, Commissioners Martinez, Garber, and Tuma opposed)
Chair Garber: If there is no more discussion, Commissioners in favor of the motion as stated say
aye. (ayes) All those opposed? (nays) The motion passes with Commissioner Holman, Keller,
Fineberg, and Lippert in support and Commissioners Martinez, Garber, and Tuma not supporting
it.
Conlmissioners, anything else? Thank you. I will close the public hearing and we will take a
five-minute break.
Commissioners, let us start item number two.
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ATTACHMENT H
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Planning and Transportation Commission
Verbatim Minutes
h~~WM
EXCERPT
Initiate Zoning Map and Text Changes to the Ground Floor (GF) Combining District and
Downtown Commercial Community (CD-C) Zone District.
Ms. Jennifer Cutler, Planner: Good evening Commissioners. This item is a City initiated action.
The intent tonight is for the Commission to consider the initiation of possible zone map and text
changes for the Ground Floor Combining District and for the Downtown Commercial
Community, the CD-C, zone district, and to hear discussion of what these changes might include.
Since this is an initiation the issue will return to the Commission for additional discussion once a
draft ordinance has been prepared and which time they will make a reconunendation to Council.
A map of the existing CD-C zoning Downtown as well as the location of the Ground Floor
Combining District is available on the wall and we have actually put it up on the screen as well.
Both the CD zone and the GF Combining District zone text in relation to ground floor
restrictions are included in the attachments to the Staff Report.
One important element of tonight's discussion is to keep in mind that there are two places in the
code where ground floor uses are restricted. So we ask everyone to try and state clearly whether
their comments pertain to the Ground Floor Combining District or to the restrictions to ground
floor uses which can be found in the CD-C District because those are slightly different but there
are a lot of similarities and I know there is often confusion between those.
Staff has prepared several possible items that could be included in an ordinance revision and
welcomes additional suggestions. Tonight we are requesting input on the four changes that were
listed in the Staff Report. Those changes are one, increase in the vacancy rate, which is required
in the GF Combining District. Two, is the possibility of allowing office and other uses on the
ground floor of buildings within the CD-C District, but those that are located outside the GF
Downtown core. Number three is to revise the boundary of the Downtown Ground Floor
Combining District either expanding or contracting in places where appropriate. Number five is
a discussion of differentiating between retail uses and restaurant uses and whether there should
be a differentiation of those.
Staff is available to answer any questions and follow up with any additional research if
requested.
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Vice-Chair Tuma: Thank you. We have just one card from the public. I see we now have two
cards from the public. So we will go to the public first before we come to Commissioners. You
will have three minutes to speak. The first speaker is Herb Borock followed by Bob Moss. Mr.
Borock.
Mr. Herb Borock, Palo Alto: Thank you Vice-Chair Tuma. I was in these Council Chambers
when the use exception of five percent vacancy rate was included in the CD zone district
regulations many years ago. I recall Council Member Levy opposing it because he said a five
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percent vacancy rate is a normal vacancy rate. The idea of permitting an exception at a normal
rate didn't make sense.
I don't believe you should initiate any changes based on the Staff Report. This isn't something
that is being brought to you because you asked for the Staff to bring it to you or the Council
asked the Staff to bring it to you. It is coming from the Staff. Instead what you get on page 3 in
the passive voice saying that somebody has recommended changes and this is some of those
changes. I believe and if they are coming from people in the community there would be a letter
attached as to whoever it is that is making the proposal. If you are being given examples I would
like to see what the other suggestions are. If Staff itself has a recommendation as to what
specific things should be changed that is what should be appearing in the report. There is a
suggestion that this has something to do with preserving retail yet it has recommendations for
areas that would make it easier for offices on the ground floor.
You had a discussion earlier this evening about how long it would be taking to do a
Comprehensive Plan revision. Suddenly you are being asked on two items, this item and the
next item, to make very specific changes in what seems to me a hurry, especially since the
economic conditions at least in the minds of the property owners don't appear to be particular
long-term, otherwise they would be lowering the rents enough to fill those spaces. So I don't see
any particular reason or any crisis that requires us to suddenly change any of this. In any event,
ifStaffbelieves changes are warranted I would like to see a more specific recommendation with
the authorship of the proposers. Thank you.
Vice-Chair Tuma: Thank you. Bob Moss will be our last speaker on this item.
Mr. Robert Moss, Palo Alto: Thank you Vice-Chair Tuma and Commissioners. I also remenlber
when this first was enacted more than 20 years ago. Initially surveys were made Downtown of
the vacancy rates on a regular basis. I can only recall one instance in the last 23 or 24 years
when the vacancy rate was over five percent and that was a very brief spike and it went back
down to about three and a half or four percent in about four or five months. So this is unusual.
The other thing I found unusual about it is I have been tracking vacancy rates along EI Camino
partiCUlarly in the Barron ParklVentura area since the mid 1970s. The last census I took was a
few months ago and the vacancy rate was approximately 12 or 14 percent. That includes several
properties that have been vacant for 25 or 30 years so you really shouldn't be counting them. In
the last four months there have been three additional vacancies where people have closed
businesses and gone out, which is not a huge amount even though there are something like 150
or 160 businesses along EI Camino and El Camino Way.
Where Downtown seems to be having a significant problem I am not seeing it citywide. I am not
seeing it on EI Camino and South Palo Alto so I am kind of puzzled about this. I think it is a
good idea to try to retain retail on the ground floor. It might be useful at least initially to put in a
temporary increase in the allowed vacancy rate to maybe ten or 15 percent. But have it expire in
two or three years when the economy has gotten better and go back to the five percent we have
now because this is a very unusual situation. As I say, we have had very rare occasions where
we have had over five percent. As Herb said full occupancy is usually considered a vacancy rate
of three or four percent. So we have been better than that consistently.
The one thing the Staff Report has that I find interesting although I am not sure I would
implement it is the problem with excessive restaurants. If you go into Downtown Mountain
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View Castro is very heavily restaurant oriented. There are very few shops to shop in. There are
some down the side streets but it is overwhelmed with restaurants. This is not good for trying to
get a business type environment. So if we are getting a lot of restaurants we ought to look at
putting in some kind of limitation so we don't have restaurants taking over the temporary retail
vacancies and driving retail out in the future. So that is something you can consider.
The other aspect is this is revising the boundary and I am not sure whether that is really
something you want to do now. I anl not sure whether you want to make it bigger or smaller or
where you would change it and why you would want to revise it. So without a compelling
reason for adding or removing blocks I think it probably ought to, be left the way it is.
Finally, the office on the ground floor, if you are going to allow that it should be done very
carefully and very cautiously. Office uses will drive out retail. One of the biggest problems you
have with an office use is they close at five 0' clock and they go home and they leave a vacant
building and it kills the vitality of Downtown. So if you have too many offices on a block it is
really bad for retail. I would be very careful about allowing additional office on the ground
floor. Thank you.
Vice-Chair Tuma: Thank you.
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Mr. Williams: Mr. Chair can I make a couple of comments please before you deliberate?
Vice-Chair Tuma: Yes, please go right ahead.
Mr. Williams: Thank you. I just wanted to respond to a couple of questions and add a little bit
more to the Staff presentation. First of all as far as the initiation of the ordinance goes this is
something that has come upon us not in the last few days but in the last year certainly. Jim
Keene in his new role as City Manager and I, as well as Steve Emslie and the Staff you see here,
have met several times on this issue and our concern about the amount of vacancy that is in
Downtown. Downtown is one of our major sales tax generators and we have had a couple of
inquiries from property owners who have looked at this section of the code on the Ground Floor
Retail and the five percent vacancy and asked what is it now and how can I request putting in an
office use? I have somebody on the second floor in my building and I would like to extend them
down. They are ready to jump down and take that office space if they can. We have basically
told them we don't do the count until the end of the year, that is what the code says, and then we
will talk about it. So we have had a lot of concern that we are going to get more and more of
those kinds of requests as the vacancy rate, we know and when we come back to you we will
provide a better inventory of this, but right now it is approximately 15 percent, triple the five
percent number. So it is going to probably be awhile before it is back down to five percent. It is
not just a matter of it is 15 percent and in six months it is going to be back down to five percent.
So we are facing this issue right now.
We are also facing some issue about some of the properties on the perimeter of the Downtown
area that have not ever really functioned very well as retail but they have had retail there, but
they have been vacant for some tinle now and have not had retail replacements. Some of the
properties on Alma and Lytton and that do not appear to be very good, particularly when they are
mid block, very good retail spaces. To some extent that detracts from sort of the concentration
that we have on University Avenue and the side streets there. So that raised our concern about is
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there a need to really look here at the fringe areas and providing more flexibility there and
providing less flexibility on the ground floor of University Avenue and the GF zoning area.
Then we have certainly talked to some of the major landowners and businesses Downtown and
our fear was that there would be a lot of resistance to raising this rate because they generally
want to have a lot of flexibility for what to do, but actually we have gotten sort of the reverse. I
think most of them are interested in preserving the retail. They know it is sort of synergistic with
the rest of the properties they have there so there doesn't seem to be much objection in the OF
area to doing that.
So in any event we thought it was important to bring this forward"and try to do it. It is not a rush
type thing where it needs to be done in the next month or even two months but certainly as we
get into fall we would like to be able to get something to the Council so they can consider this
and hopefully have something in place about the time or shortly after we do our next required
survey and report out to them.
As I mentioned, there is the sales tax generation aspect of the Downtown. There is also sort of
the question of if we do modify the vacancy rate what is the right number? I heard Mr. Borock
and Mr. Moss talking about five percent was adopted awhile ago that is a standard number. I
think we have to ask should there be any nunlber? Should there even be a vacancy rate outlet
here or should we basically be saying we want ground floor retail and it doesn't really matter
how high that vacancy rate goes. I think someone said once that office gets established there
then it is very difficult to move it out. The current language says that it is supposed to move out
in five years. I wouldn't relish being the person to try to tell that office user that might bea very
successful office user there that they now have to leave because the vacancy rate is back down to
five percent and it was only a five-year approval in the first place.
So I think we really do need to look at these things in a timely way. We certainly are willing, as
mentioned in the report, willing to look at the restaurant issue as well. That is something I think
the people we have talked to Downtown are very resistant to change. They would like to have
the flexibility to do restaurants and feel like that is almost the anchor of Downtown is I think
what one of them said is that is what really brings a lot of people to Downtown. By the same
token it does have, as Mr. Moss says, the effect to some extent of once you get a restaurant in
somewhere there is a lot of infrastructure that goes into that in terms of equipment and tenant
improvenlents that are often hard to undo to get retail reestablished in that place. So it is
something we would certainly be willing to look at as part of this effort as well. Thank you.
Vice-Chair Tuma: Thank you. So procedurally just a couple of questions to clarify with Staff.
The only thing we can do tonight is initiate or not initiate.
Mr. Willianls: Correct.
Vice-Chair Tuma: We are not actually giving any specific direction on what the components of
the changes would be. Although you have asked for guidance on not only the items you have
listed as one through four but any other thoughts that the Conlffiission has. You will be coming
back with a draft ordinance if we were to initiate.
Mr. Williams: That is right.
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1 Vice-Chair Tuma: Okay, great. So I have a question 'for Commissioners procedurally_ It seems
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to me that we need to come to some consensus on whether we are going to initiate or not to make
3 the discussion about what the recommendations would be with respect to what those changes
4 might be. I would rather come to that consensus sooner rather than later in the discussion but I
5 don't think people would necessarily be prepared to do that now. Again, I intend to do that with
6 a straw poll and then assuming that we are inclined to move forward with initiation test each of
7 the various components of what the recommendations might be also with straw polls to give
8 some more concrete guidance to Staff. Does that make sense to folks?
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10 If at any point people feel like we are there I think we should focus the first part of the discussion
lIon to initiate or not to initiate and once we get there then let's get into the substance.
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Mr. Larkin: Just to clarify the initiation itself takes a motion but in terms of any guidance on
14 what would actually go into the changes that would just be done with a straw poll because the
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Commission can't really act on that tonight.
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voted on prior to getting into getting into the discussion about the other items, correct?
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20 Mr. Larkin: I don't know that it matters what order it is done. I think obviously if you are not
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going to initiate it is not worth getting into the other items.
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Vice-Chair Tuma: That is what I was trying to avoid. I want to make sure that everyone is or I
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don't want to have a whole big long discussion about topics if we are not going to initiate.
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then talk more about what you would want to see come back.
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Vice-Chair Tuma: Okay, fair enough. Great. Commissioner Holman.
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Commissioner Holman: We have had some other items that have come to us for initiation and
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sometimes we end up getting into a lot of fine grain detail about what would actually be coming
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back to us. So what I am hoping we can avoid is getting into the arguments pro or con, different
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aspects of what might come back to us but rather focus on the kinds of things that we would be
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interested in seeing in what would come back to us.
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Vice-Chair Tuma: I would concur with that completely. So with that I have lights from
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Commissioners Keller, Fineberg, and Lippert in that order. Commissioner Keller.
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Commissioner Keller: Thank you. I believe we have had problems in the past of making a
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motion, which was voted on, and then having comments follow the close of the motion. We
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have been told in the past that once we make a motion we may not comment further on it. We
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were once told that.
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Mr. Larkin: I don't know why that has been a problem. Because of the way that this was
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agendized it is agendized in a way that would allow you to make comments. What you can't do
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is direct what goes into the motion until that is in front of you because tonight you are just
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initiating. I think you can make suggestions as to things that the Staff should be coming back
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with as items to explore.
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MOTION
Commissioner Keller: So with the understanding that we can make a motion, at some point vote
on the motion, and continue to make comments I am going to kick it offby making a motion that
we initiate. Then after that I would like to come back and make some comments.
SECOND
Commissioner Holman: Second.
Vice-Chair Tuma: Okay, motion by Commissioner Keller and seconded by Commissioner
Holman that we initiate. Would you like to speak to the motion?
Commissioner Keller: Yes. Firstly I take credit or blame for this particular item. When we
talked about the retail report for the Comprehensive Plan discussion a few months ago and that
was coincident with the Report to Council based on the study that was done in 2008. At that
point I specifically mentioned that we need to consider bumping up the threshold. There was a
member of the public that commented that this did not come from the Commission and in fact it
came from me and I don't remember if there were any other comments from Commissioners
about it but I do specifically remember having nlentioned that.
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My thought or rationale at the time was that if we were to allow because of a there is a
difference between a blip, which this is essentially a blip. We hope that this is not a long-term
trend. We hope this is a temporary thing because of a deep recession. If it were a long-term
trend then you might consider allowing office to creep in but essentially that would be the death
of Downtown because you would be getting Swiss cheese. You would essentially have offices
creeping in creating holes in the retail of Downtown and thereby losing the vibrancy of the mix
of kinds of measures.
I will basically want to come back after we vote on this make more detailed comments but
essentially I think that we need to do this in order to prevent making Downtown into a Swiss
cheese of retail with holes of office. Thank you.
Vice-Chair Tuma: Commissioner Holman, would you like to speak to your second?
Commissioner Holman: Just briefly. I appreciate Staff bringing this forward and appreciate the
proactive aspect of it. I think we should initiate for a few reasons but among those primarily
would be the preservation of existing and ongoing retail uses. We need to support them with the
continuation and the synergy, as you mentioned Curtis, of other retail uses. So that is why I
seconded the motion.
Vice-Chair Tuma: Okay, would anybody else like to speak on the motion? Commissioner
Fineberg.
Commissioner Fineberg: I have a question for Staff that goes specifically to the need for
whether or not to initiate. It relates specifically to the discretion that the Director has when
reviewing and approving an exception. Weare now in a condition where we are it?- excess of the
five percent vacancy and a property owner may bring forward an application for the exception.
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Does the Director have the discretion to simply say no? Can the Director say no sometimes? If
they say yes sometimes must the Director say yes in all similar cases?
Mr. Williams: Well, I think there are some findings and determinations that need to be made. It
says an application for uses permitted if the application is made and the vacancy rate is five
percent or greater, demonstrate that the ground floor space has been vacant/available for six
months, and then it is limited. Are there other findings?
Ms. Amy French. Current Planning Manager: We had a little discussion the other day at the preCommission meeting and Curtis was not available for that portion of it. Basically we discussed
how there really are not findings here as you would normally see for a use permit or such. It just
basically said if these conditions are met five percent and they can demonstrate then there are no
other findings. So it would be rather difficult for the Director to say you haven't met the third
finding because there isn't a third finding.
Mr. Williams: Yes.
Mr. Larkin: It would be a quasi-judicial decision by the Director. The only way that the
Director would be able to deny the request is ifhe felt that it didn't meet the six-month standard
or there wasn't the vacancy rate or they weren't actually trying to market the property. So there
are areas where the Director would have discretion but it wouldn't be because we don't like this
particular office use or anything like that.
Vice-Chair Tuma: I am going to chime in on this just for a second because we did discuss this at
some length at the pre-Commission meeting and one of the suggestions at that point is part of
what we certainly are in a position to do is to suggest that findings be developed. We may have
some thoughts on what those might be but one of the possibilities coming out of tonight's
meeting would be that findings should be developed, put together, and brought back as part of
the ordinance where there are specific findings that need to be made. So that is certainly one of
the opportunities that is before us tonight.
Commissioner Fineberg: Okay. So if the findings are met that the vacancy rate is greater than
five percent or it has been vacant for six months the Director could not decide that it is not
consistent with the goals of the Comprehensive Plan for retail retention, it is not consistent with
Council's mandate to preserve neighborhood serving retail, so those policies and co~es or
programs I should say wouldn't be sufficient to support the Director in a no decision. Is that
correct?
Ms. French: The first point is it is an 'and' not an 'or.' The second thing is there are other
permits in the Title 18 like a Conditional Use Permit or other permits usually one of the first
findings is that it is consistent with the Comprehensive Plan. So that would be one of the things
we could consider adding into a finding but it is not there now.
Commissioner Fineberg: So without that the Director has no discretion and the answer is a yes
and so we would be adding those controls. Okay, thank you.
Vice-Chair Tuma: Commissioner Lippert on the topic of initiation.
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Commissioner Lippert: Yes. I would definitely support initiation. One of the reasons why I
moved to Palo Alto, actually the area where we live is Downtown North, is because we are in
proximity to the Downtown. One of the things that we really love about being near the
Downtown is all the wonderful retail and restaurants and other services that there. Weare able
to leave our house, not take our car, and walk down University Avenue and treat it like it is a
neighborhood shopping center. I wish that there were some other uses that were defined when
we moved here to Palo Alto there were bookstores and movie theaters, which seem to have
evaporated. I think that it is hard to regulate bookstores but they surely are missed in terms of
the quality and character of Palo Alto. When we first moved here I think there were four or five
movie theaters in the Downtown all within walking distance. Those would have been desirable
uses to have preserved as well.
So I think that the crux of any smart growth and livable community is that we have a mix of uses
and that includes the preservation of retail and commercial. So I would definitely support
initiation of what is being proposed here.
Vice-Chair Tuma: Okay, great. Just to round out the crowd I am very supportive of this as well.
My wife and I from time to time, because we live in South Palo Alto, we go over to California
Avenue in the evenings. There are a couple of restaurants at one end but the rest of it has
nothing going on and we talk about this from time to tinle. It is generally because they have a lot
of office or the types of retail that close down early. So it is not a very vibrant section of town.
We certainly don't want that sort of result.
MOTION PASSED (5-0-2-0, Commissioners Garber and Rosati absent)
So with that I am prepared to call the question and ask for a vote. All those in favor of the
motion, which was to initiate these changes say aye. (ayes) All those opposed? That passes
unanimously five to zero.
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What I think would make the most sense here is to go down the line. If each Commissioner is
prepared to when you get to your comments and questions address the four items that are on
page 3, and if you don't have any comments or a position on any of those that is fine as well.
Then add to that any additional items that you want to see considered. I will try to keep track of
these and then we will do some quick polling in the end to make sure we give some clear
guidance to Staf£
Mr. Larkin: Sorry to interrupt. You had asked me at one point to do the time checks and I was
just going to point out it is nine o'clock. I think you are well on track but there is one other itenl
tonight.
Vice-Chair Tuma: Right, thank you for that. That's great. We do have one other item and we
would need to sort of make a decision as to whether we would start that item after ten o'clock if
we don't think we can get through item three by ten. So Commissioner's thoughts, can we get
through all four of these items tonight and be done by eleven? Okay, very good point. So with
that let's go down the list here. I have in this order Commissioners Keller, Fineberg, Lippert,
and Holman, and then me if there is anything left.
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Commissioner Keller: I guess I am next. So the first thing is that essentially we have an
anomaly. I guess there are a couple of anomalous situations. First of all we have a very deep
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recession. It is interesting that the term depression came along because people were fearful of
calling the Great Depression a recession so they created a new term called a depression, which
turned out to be far worse. A little history for you.
So hopefully it is a big recession and not a depression this time. We also have the situation that
essentially what has happened over the last ten or 20 years is that retail rental rates have gone up
dramatically squeezing out things like bookstores, and essentially making it hard for nl0vie
theaters and other uses that provide a mix of uses Downtown. These rental rates have gone too
high and it may be tliat the desires of landlords/property owners for how much rent they should
charge are excessive and they need to recalibrate that to base market.
The reason I start offwith those comments is essentially if you charge a huge amount of money
you can keep a property open for six months. If somebody owned more than five percent of the
Downtown retail, which probably exists, there are probably a nurrlber of property owners that
own more than five percent of the retail Downtown. They could deliberately raise the prices on
their properties, keep their properties vacant, and trigger this situation. Thereby allow
themselves to get office space down there. Now I am not suggestion anybody would be as
nefarious as to do that but it essentially indicates that there is problem with our current
ordinance. Creating findings would go a long way towards reducing that but it seems to me that
one of the findings if we were to have findings should be that based on the vacancy and the rent
being asked in some sense is consistent with rents being chosen.
Now am I allowed to talk about specific properties as exemplary?
Mr. Williams: I think so as long as there is not any kind of permit in front of you for that
property.
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Commissioner Keller: Great, thank you. so the first thing I am not going to mention a particular
property but there was a recent opening of a restaurant Downtown that replaced a restaurant that
closed. I am not going to mention which particular restaurant it is. I happen to go in there to eat
and asked the owner, so you are new here. This particular restaurant moved from an off
University Avenue location to a University Avenue location and I asked how is the rent
compared to the old place? The restaurateur basically mentioned that the rent is killing them and
he or she hopes that they will be able to increase business sufficient to cover that rent. So it is
pretty clear that rents are not being accommodated significantly in order to be able to accomplish
fuller occupancy of these units.
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Similarly, Bob & Bob off of Downtown on High and Forest was forced from Downtown because
of the rents being too high. They relocated over to Los Altos on El Camino to essentially the
middle of nowhere if you will. That business failed in part because of that relocation. Instead of
lowering the rent, which could have been done to that owner and retail establishment, and
keeping that retail establishment the rent is too high. In fact, since Bob & Bob moved out which
I believe was over a year ago that location is still vacant. So instead of the owner receiving some
rent for that place, which would have been lower in order to be able to keep that establishment,
we have a rent that is for this location that is effectively zero because nobody's paying it. So I
think that is a consideration.
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Vice-Chair Tuma: Commissioner Keller, if I may. We just collectively agreed we were going to
try to get through this item and the next item by eleven 0' clock. That gives us approximately ten
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minutes each to get through all the comments that are directly related to items that would or
wouldn't go in a potential modification of the ordinance. So if you stick to focusing on those
that would be great.
Commissioner Keller: I appreciate that. I think that that is important prefatory material for us to
really understand what the impact of vacancies are and how they can be caused and not caused.
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I think that it would be useful to increase the vac~cy rate formula perhaps 20 percent with the
understanding that we would revisit this in the future. In any event we should create findings,
that is item one.
Item two I don't really understand the issue here because in some sense if you allow office use
regardless of the previous use I am not sure I understand that. So I just request that that
reasoning be clarified because it doesn't quite make sense to me. Do you want to respond to
that?
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Ms. Cutler: The issue there is the distinction between the area that is in the core of Downtown
that on the map is in orange, those are the areas that are covered by the Ground Floor Combining
District, and that is where we have the five percent vacancy rate as part of the code., The
distinction that we were making in item number two is about all of the properties that are in
yellow which are in CD-C but do not have the ground floor overlay. Since those areas are
farther from the core there has been discussion that maybe a concentration of the retail uses
along the center of this core is more important, and that maybe the fringes are not as appropriate
for retail all the time. That we would strengthen the ground floor retail restrictions for that core,
the orange area in the Ground Floor Combining District, but maybe loosen them some for the
yellow area which is just the CD-C with no combining district.
Commissioner Keller: What restrictions do we currently have for the yellow area?
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Ms. Cutler: They are very similar. The precise code is attached to your Staff Report. They do
not contain this five percent vacancy rate.
Ms. French: I was just going to add specifically on number two what we are trying to get at
there, the flexibility is right now if somebody were to go in there and it had been office and a
retailer wanted to come in and occupy that space our code dis-incents allowing that retail to
come in because we are going to forever hold them to keeping a retail use there. Getting some
flexibility would mean they could have a retail use come in there and then they could at some
point maybe go back to office. So that is the kind of flexibility as an example.
Commissioner Keller: Thank you. So this is something that is referred to as a ratchet in that
sometimes you can go one way but you can't go the other way. So essentially what you are
allowing is to go both ways.
Mr. Williams: Right. So the real difference is the Ground Floor Retail District requires retail on
the first floor, period. I mean a retail, restaurant, personal service type business. The CD-C
District in general doesn't require those uses. It allows office and some other uses on the first
floor as well except if you already have retail then you can't do anything else with it, like Amy
said. Then if something right now is an office use, it is vacated, there is a change for retail to
come in, I know there have been instances I have heard of where they ask if there is any
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flexibility and they end up not leasing it for retail because they don't want to get boxed in to
where they can't convert it back to office in three years or so if the retail doesn't work out. So
that really sort of frees the retail ifit is there but ifit is not there already then it isn't bound the
way the Ground Floor Retail (GF) District is.
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So this would look at that area and there are a wide range of options that we could look at as far
as either just taking away that requirement so you had the flexibility to do either one, or we
might define it in a specific way so maybe if it is at comers it would still be restricted to retail.
Maybe we take the GF District and we extend it up to certain areas where we think that there are
really viable retail pockets but other areas aren't restricted. So those are the kind of things we
would be looking at and coming back to you with recommendations on.
Commissioner Keller: Another thing you can consider is in terms of the findings is whether
there has historically been retail there, could be one of the findings to consider. That might be
another way of handling it. So in terms of that now I understand what number two is.
With respect to number three I just want to make sure that we don't have islands of retail
separated by office because that can be problematic. Even if you have a restaurant for example
there is the Tamarind Restaurant on University Avenue at the intersection of Tasso. If you
essentially make an island of that that may harm that restaurant if you don't have retail
continuing up through there.
With respect to number to four I do think it makes sense to think about limitation of restaurant
use. I think we have talked about that in the past. I realize that restaurants in some sense
collectively make an anchor to the Downtown hut there is another term for anchor, which is
something that makes something sink. If we have too many restaurants Downtown could sink in
the process of that and essentially become largely what Downtown Mountain View is which is a
place to eat and then leave, or go eat and then go to the Theater Works and essentially nobody
does anything else there as far as I can tell.
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A couple of other quick comments. I am sympathetic with your issue that the use exception
being a limited duration in some sense is problematic. The issue is that leases might be aligned
with that use exception and you can make sure that the leases do not get renewed. People
typically amortize their tenant improvements along the lease duration.
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Also with respect to office on the ground floor I observe that if you look at 18.30(C).020(a)(7),
which is Attachment C, it says entrance, lobby, or reception areas serving non-ground floor uses.
There appears to be no limitation to that. I would suggest that you consider a conditional use
permit to the extent that an entry, lobby, or reception area exceeds a certain square footage. For
example, the property on University Circle, if you understand what I mean by that, there is a new
building that went in there which is a facebook building and the entire ground floor is an entry,
lobby, or reception area for what used to be Bungee Travel that was a retail use. So by using this
exception that retail use was essentially converted into an office use. So I think that is a loophole
that should be covered by a ClTP since it is more than simply a certain square footage.
Finally, I would like to reiterate my comment earlier about the retail rental rate being somewhat
related to nlarket rate under some discretionary thing should be considered one of the fmdings so
that landlords can't charge excessive rental rates in order to obtain the six month vacancy that
they should charge market rates. If this brings down rental rates to the extent that we can
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actually have new businesses thriving Downtown then we may get more of the mix of businesses
that we had ten or 15 years ago as opposed to the ones we have now, which are essentially .
restaurants and high-end retailers, so more people in Palo Alto would find it desirable to shop
there.
Vice-Chair Tuma: Commissioner Fineberg.
Commissioner Fineberg: I would like to start with a moments worth of prefatory comments.
The situation that we are seeing with redevelopment on University Avenue in my mind is more
complicated than simply a temporary economic downturn. Up until last September we had what
I call a lot of funny money in the economy. Money that was being used to develop properties
that were not viable, money that people were putting forward because there was no risk with the
development. The financial collapse that happened and subsequent reregulation that is coming
into play at the federal level is dramatically changing that landscape and that funny money at
least until we have our next colossal mess is gone. When we have properties on University
where landlords don't have tenants and landlords don't have lenders it is not the recession that is
causing it. It is simply not a viable redevelopment. That development is not going to happen in
six months. It is not going to happen in a year. They are going to have to have tenants. They
are going to have to have financing and the econonlies in the project are going to be completely
different. That is not Palo Alto process causing it. That is not residents causing it. It is not the
Staff. It is just how the world is now and it is going to change slightly in six months or two
years.
In order for developers, in order for property owners to plan they need a consistent set of
predictable conditions. Right now they know they can come to our Planning Director and with a
'vacancy rate in excess of five percent they can convert to offices. If offices pay rent in excess of
retail that is what they are going to plan on doing. They will run the numbers and if they can
make more money holding it vacant for six months, they will do that, take the short-term hit, and
then for however many more years they will have the increased revenue. So it is a simple
economic calculation that a landowner will do in his or her best interest.
So we have the option of changing the regulations that change the behaviors that change the
conditions that those landowners will use in making their decisions. On the first item I would be
curious to have more discussion on whether 15 to 20 percent is the correct amount to trigger an
exception process or whether no condition triggering that exception process would be a better
state. Should itsimply be an absolute it is GF that's that it will remain retail? I don't know what
the impacts of either path would be. Do we have two landowners that own 30 percent of
Downtown that could easily trigger it? Do we have such a disparate ownership that no one could
trigger a 15 or 20 percent vacancy rate? So we need to know what the concentration of
ownership is.
I would also wonder if we have no condition under which there can be a conversion to office, do
we then not need to have findings. I don't want to make it a simpler process just so it is a
simpler process but if we have it as an absolute condition that there be no exception we don't
have to go through the fine grain analysis of what are findings. If we want that flexibility to
allow exceptions when appropriate then those findings become critical and I would want input
from both the business community, Staff, and Commission in future discussions for what is
going to work.
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On the second point, thank you Staff for your comments because to be frank what was written in
the Staff Report I did not understand the intent of what the second item is and with the additional
comments from Staff it seems like a very reasonable incentive not just a giveaway. One question
with that is would there be wisdom in adding some kind of a starting date for when it would
become a two-way flow? So if it was retail prior to X date there is no converting to office so you
don't lose from you have now and that would not penalize people that made the right decisions
in the past. I think that is how that one would work. Then you won't lose the retail that you do
have in your CD-C.
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On the third one I would want to get some information about, I am kind of trying to ask you to
predict the future, but is there any estimate of how many of those buildings in the CD-C would
convert from retail to office or raise rents on retail to drive retail out? I don't have any sense of
what those impacts might be. I would agree with previous comments that we don't want to tum
it into Swiss cheese.
On the fourth item I would be in favor of a mechanism to limit the number of restaurants. When
I go to Castro Street in Mountain View it is absolutely clear that it is a restaurant destination.
Our University corridor is trending in that same direction. I would also want to see some
discussion on if there are other categories of businesses. Do we want nlore nail salons and hair
shops? I don't what other and maybe off University on the side streets are there other categories
of businesses we are also seeing too many of? Would there be a way to make that something
that could change as distortions develop? And is there mechanism to build in that if there is a
distortion we could react quickly? That I think would be a good tool. That's it.
Vice-Chair Tuma: Thank you. Commissioner Lippert.
Commissioner Lippert: Well, the restrictions that were put on back in 2001 were based on the
dot.com bubble or pre-dot.com bubble. At that time there were really significant high tech
ventures that were poaching retail space and converting it into office space. That is why that was
implemented. I would gladly welcome those times back at this point.
The truth is that when it comes to point number one what is important is that we have a blend of
uses and mixes. That 15 percent, 20 percent, or five percent really doesn't mean very much.
What is important is in order to have a viable Downtown you need to have commercial office,
you need to have professional services, you need to have financial services, and you need to have
retail, and they all need to be able to work together. Having ground floor retail really makes our
Downtown vibrant and alive, and it makes it a livable, walkable, usable community. To take
retail space and convert it into more office space at a time when we have a vacancy in office
space just doesn't make any sense. We have a glut of office space, empty commercial office
space. I just don't see us having when the vacancy rate number trips being able to open up and
make more retail space available for office space how that really benefits us. What we really
need is a viable blend of retail, office space that is going to work and make the Downtown area
vibrant.
So in some ways I was listening to what Curtis said and I almost support the idea of just
forgetting about what that vacancy rate is completely and shoving it out the door, and saying
look ground floor in that area is retail, we need it.
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With regard to the second, allow offices on the ground floor of buildings. When you think about
the Downtown it isn't just University Avenue, it is the fingers of streets that come off of
University Avenue. In the tinIe that I have been in Palo Alto we have seen how Emerson, the
Emerson corridor, has become another almost like intersection of Broad Street and Market where
we now have an annex down in the SOFA area, which is a viable retail district. So what I would
want to see I guess is University Avenue and at least the first block on each side of University
Avenue to be viable ground floor retail. What it does is begin to then expand the Downtown into
other areas and begins to create a more viable Downtown. So I would entertain definitely
looking at being able to expand and contract that boundary and looking at what that means.
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With regard to differentiating between retail uses and restaurant uses I don't think so. I don't
have a fear of Downtown Palo Alto becoming like Castro Street. In fact, Castro Street has
benefited from Palo Alto. Book Buyers used to be in Downtown Palo Alto. Book Buyers is now
on Castro Street. They have been there the last ten years. That is one of my favorite bookstores.
I go to Castro Street to go browsing through used bookstores and CDs and whatever. I don't see
a differentiation between retail uses and restaurants. I think it is whatever the market brings that
makes us into a viable wonderful Downtown for being able to spend time.
Lastly, the only other thing that I really want to make a comment on, and now that it is on the
table looking at this are banks. Banks are great activity killers. What I mean by that is banks are
only open from nine to four. They generally in these days and times turn their backs on the
street. They want to be secure themselves so they are not watching the street. They are closing
themselves off from the street. My bank, which is Union Bank, has frosted their windows on one
whole side. It used be that you could stand in the bank and look out across the street and you
can't do that any more. Wells Fargo bank now has three branches on University Avenue. They
have their private services, they have taken over the bank on Cowper, and they also have the
other bank on Hamilton. How much market share does a bank need in order to remain viable?
All that it does is kill those blocks from after four o'clock and in the early morning hours. So if
anything I wouldn't limit restaurants I would limit banks maybe, financial institutions. So that is
my two cents. I look forward to looking at the initiation and having more substantive things to
bring back.
Vice-Chair Tuma: Great thanks. Commissioner Holman.
Commissioner Holman: Thank you. One quick nod to Commissioner Lippert. Bijou, Festival,
Biographic, Aquarius, Varsity, and Stanford those were the theaters here in the early 1980s.
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Commissioner Lippert: Not to mention the one that used to be at EI Maghrib, Moroccan
restaurant.
Commissioner Holman: That's right. That may have been the Biographic I am not sure. At any
rate as to item number one I have been known to say in the past zone for what you want so I
appreciate Curtis's comment about not having a percentage but just make it a ground floor
requirement. Other Commissioners have commented to that effect too and I would support that.
I think to answer Commissioner Fineberg if I might I think would of course eliminate the need
for findings.
Allowing ground floor in the CD-C district outside the GF regardless of previous use I think that
is a possibility in combination with number three. Number three from my perspective there are
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some areas where again akin to some of Commissioner Lippert's comments, I think there are
some areas were we ought to expand the GF and I think there are probably a couple of areas
where we ought to remove it. Alma has been mentioned as a location to remove it and I think
that is probably very likely.
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Differentiating between retail use and restaurant use, as Curtis knows I have been concerned for
a long time about how much restaurant use we have Downtown and how it displaces other uses
long, long, long term. Because of the capital investment once a restaurant goes in it doesn't
convert back to other retail for nlany, many years. They also have large parking impacts, not the
highest retail sales return. There are a lot of good things about them but they also in too large a
proliferation they have some pretty significant negative impacts as well.
Commissioner Lippert did however mention something else I had in my notes, which was
putting limits on financial institutions.
I was interested in the business outreach because as I read the comments I didn't see any
comments that looked like they came from retailers. They looked like they came from property
owners, and maybe larger property owners. So I would be curious to know what the PAd had to
say and what individual business owners, if there was outreach to them, I would be interested in
knowing what they have to say going forward. Some of the things that I think we could do to
help sonle of these owners and businesses is we have needed I think for a long time to do
something to improve the process. I hear so many complaints of people who don't want to go
public because they don't want to literally, valid or not valid, basis or no basis, they don't want
to go public with their complaints of getting permits to open a new business because they are
worried that if they want to expand or do any other revisions to their businesses or expand that
this would be held against them. Businesses just go through arduous process, at least as it is
described to me, to get permits. That may seem a little disparate from this but it really isn't from
my way of seeing this because I think if we are going to add some restrictions I think we ought to
also look at what we can do to make life easier to after all attract more retail business which is
what this is all about anyway, attracting and retaining. So that is one.
Just a couple of other comments about this, again in these conversations with these businesses
what else can be done to support the businesses. I know recently there has been an allowance,
rather than businesses just doing it I think there has been a trial allowance maybe it is to allow
sandwich boards. That is my understanding anyway. So perhaps there are other things like that
that are no cost but that really help promote the businesses. If they have to present something
then it can be done in a well-designed fashion rather than things just popping up.
The other thing is permitting for events. I have also heard just kind of torturous processes that
people have to go through for that. The other thing I would be interested in looking at is those of
us up here and sitting at the table down there are well familiar with the advantages to
communities of local independent businesses. So perhaps there is something we can do to
promote or incentivize the local independent businesses. They tend to stay longer, put more
back into the community, more likely to stay because of their investment in the comnlunity, and
they are more likely to stay in ups and downs in an economy.
While we are doing this if it is not going to delay things there have been issues that have come
up in the past having to do with hours of operation. One particular case on Ramona between
University and Hamilton for instance that I can recall they satisfy the literal definition of retail
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but their hours of operation were very, very limited and then by appointment. So it really caused
a break in that retail synergy that we have long talked about.
The other thing again, if this isn't going too far and doesn't cause delays, is window coverings
and type of glass because that is another issue that has come up over time. Transparency of the
window materials is important if it is going to be retail and again keep people going from shop to
shop to shop.
It is important to have office. You do need a nlix but we have two, three, four story buildings
and offices can be located other than on the ground floor.
A question about PCs. Is it possible to initiate changes to PCs that might not have ground floor
retail? Again, not saying that it would have to change immediately but such that if the use ever
changed that it would have to convert to retail. We do have some PCs in this area.
Mr. Larkin: I think that would probably be possible. You can rezone it so that if it redeveloped
it would have to redevelop as ground floor retail.
Commissioner Holman: Redevelop is one thing. I am not talking about redevelopment I am
talking about a change of use.
Mr. Larkin: Or otherwise you could amortize the zoning and require them to - well, without a
specific example it is difficult. But you could amortize it and make sure they get full use out it
and after a period of years they would be required to change the use. I don't think you can do it,
pass the zoning ordinance to say tomorrow now you are ground floor retail.
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Commissioner Holman: That was not what I was after.
Mr. Larkin: Or tomorrow if they change tenants. You would have to amortize that use.
Commissioner Holman: Okay, Staff if you could come back with some information about that
maybe perhaps which locations that might apply to.
The other thing again, I alnlost hate to mention this but I will- I won't. I think I will stop there.
It is just one other thing which is signage. I think there is something that in hard economic times
we tend to look at how we can cut back on expenditures and attract new dollars or generate new
dollars and sometimes I think we get in kind of a gather the wagons around and kind of restrict
our thinking. I think there are some opportunities that might exist where the City could spend
perhaps a little bit of money to help make the retail environment more attractive. Clean
sidewalks are one thing I would absolutely mention. Doing something about some of those
things are an expenditure of funds that I think would be helpful to attract a long-term financial
benefit to everybody involved. So I will stop there. Thank you.
Vice-Chair Tuma: Okay. So before I go through the four items one of the things that is going to
be extremely important when this comes back is a fair level of detail on the outreach to the
business community. I would offer by way of suggestion things like - well first of all, not just
going to the usual suspects but rather making sure that we are talking to some of the smaller
building owners, we are talking to the Chamber of Commerce, we are talking to the Downtown
Business Association, a real spectrum, and offering a variety of opportunities or avenues for
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input from those folks. Not just hey let us know, but holding some open forums for discussion
and things like that. So what is going to be real important is sort of the level of outreach and the
feedback from that. Everybody who is involved in this and who would be impacted by this
because I think that collective wisdom is I think very, very important to making sure we are
making the right decisions here. I think we all have the same goals in mind but these are people
that this is what they do every day. So I think we need to make sure we get that feedback.
That being said, on items one through four I anl supportive of looking at all of those. I think it is
all-important. Those are all important discussions to have. On item one I am not necessary open
or closed to it being zero as opposed to having some threshold. I think that is one of the key
issues for me in terms of input from the community. I want to make sure we don't have some
unintended consequence of doing that.
With respe,ct to the other three, I think having flexibility in the CD-C(P) District makes a lot of
sense. I think we definitely should reexanune the boundaries. I am supportive of differentiating
between retail use and restaurant use.
I did have a question. On the map there are a series of, I think there are five or six buildings on
University Avenue that are white. In other words they don't appear to be part of this district. Is
there some reason? Should those be reexanlined? Maybe the existing uses are not necessarily
but should that be looked at is the question for Staff
Ms. Cutler: Those locations that are not colored in by the orange or the yellow but are kind of
within that area, most of those are Planned Community, PC, Districts so they were developed
with individual zoning regulations, and therefore are not covered by these zoning designations.
Or they are Public Facilities. So they are plazas and Downtown parking lots, etc.
Vice-Chair Tuma: Okay. So if it is a parking lot and if at some point that parking lot was
converted to a building in that process would we look at whether it should be included? Is that
how that would work as a matter of course?
Mr. Williams: Well, they are generally right now public parking lots. So they are PF zoning.
So to be developed as private developments they would require a zoning change and in that
zoning change if it were to a PC you could consider the specific use otherwise it would be
probably to a CD-C or GF zoning that would require, especially ifit is on University Avenue, it
would be GF.
Vice-Chair Tuma: Okay. One of the other things that I think is worth looking at or exploring in
this process is if we do go down a route of continuing to have a trigger, I don't know whether we
actually would put it in the code or not, but somehow an opportunity to reexamine this in three to
five years or some sort of timeframe like that. Where if the economy significantly changes, not
if someone just thinks about it, but we actually have a trigger that says we will look at this again
in some period of time to make sure that it is doing what we want it to do. So again not to be left
to the memories of those involved but rather actually make it part of the ordinance that in sonle
relevant amount of time we would look at this again. I think that is worth discussing as to
whether that would be in there or not.
It looks like we have a few more comments. Let's go through the rest of the comments. I think
Commissioner Fineberg was first.
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Commissioner Fineberg: On the fourth point, and I appreciate this extra round of comments
because sometimes other Commissioner's comments spur additional thoughts. On the fourth
point would it be worthwhile approaching the idea of differentiating restaurant use by looking at
it in terms of a regulation of single purpose uses? So that when lenders for instance loan money
to businesses for tenant improvements they have a different set of criteria when the tenant
improvement is a single purpose use, nleaning a restaurant. That may be a way to approach how
to regulate rather than as a class of businesses. Banks might fall under that too if they are a kind
of a bank that builds a vault. The cash vault tends to be very single purpose use. You are either
going to be cash or jewelry or it is going to be a really cool conference room with thick walls.
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The idea of regulating banks made me think about what is a bank? It used to be we could all
define what a bank was and it was a place that people went in with cash, there were teller
windows, and now we have things that are called banks that are really offices where you go in
and get mortgage paperwork, or offices where you meet with an investment broker and you are
trading securities over the internet. They are really office uses that are owned by the institution
that is legally registered as a bank. So is there a way to look at the actual use in the space rather
than what is the form of ownership? The might trigger a way to reduce the amount of office
space that is owned by banks that are not behaving like a bank. So kind of looking at what the
purpose of the business is rather than the form of ownership, and then what the build out is. I
don't know whether you would control that through the regulations in zoning or at the place
where you issue the building permit for the single purpose uses. I will leave that to you to
explore. Thanks.
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Vice-Chair Tuma: Commissioner Lippert.
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Commissioner Lippert: Just a couple more comments. We have also lost a number of real
important services. The Downtown really doesn't have a viable copy shop. I know that there is
one. I use it when I have to but we don't have a Kinko's. I have to drive to Menlo Park. I have
to drive to California Avenue for Kinko' s. We used to have three or four copy shops in the
Downtown area. We used to have a cobbler in the Downtown area. So we have lost a lot of
those, they are not really retail they are personal services. So that would be something that I
would be interested in seeing that we try to retain or preserve.
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Then with regard to theaters I used to go to Century 16 but now I go to Redwood City because I
can take the train up to Redwood City and then I can walk around, and I can eat dinner, and then
I can go to a movie in Redwood City. If I decide to drive because there are a lot of us we get
free parking. The preservation of our theaters, they are really puny, but they are inlportant art
house theaters. In the preservation of theaters, I hate to say this, but if there is some way to have
some sort of a TDR program where rather than seeing them get converted into bookstores or
some other retail use they were preserved and even added onto and get bonus floor area, that
would be something I think would be a positive thing.
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Vice-Chair Tuma: Commissioner Keller.
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Commissioner Keller: Thank you. A couple of comments. I am in support of the idea of
mandatory ground floor without exception. The way to handle exceptions could be by rezoning
it to non-ground floor. We have the ability to do that so that might be the best way of doing that
process if you will.
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With respect to a trigger for CD-C for number two perhaps there might be findings in terms of
dealing with that so that you have a little bit more discretion in terms of that and also give some
more direction in that issue.
We might think in terms of density for particular uses like restaurants and such. I think that there
is a difference between a bank that behaves like a bank, although sonle people may have some
criticism, the Wells Fargo Bank on Hamilton and Waverley behaves like a bank. People walk in
there, they walk out, they see tellers and such. The Union Bank on Waverley and University
behaves like a bank. The Wells Fargo on University and Bryant does not behave like a bank it is
really an office. It should be treated as an office and we should make that distinction. I think the
Fidelity on Ramona and University doesn't really behave like a bank either. First of all it is a
brokerage house. So that should be more considered office. I don't see people have much of an
issue going to the second floor. So I would be in favor of amortizing those uses out to encourage
ground floor retail in both of those locations. I am not nearly as concerned with the E*Trade that
is on University Avenue between High and Alma because that is not necessarily that viable a
location for retail. It is sort of on the fringe.
I am wondering with the future transitions of what is going on with high-speed rail whether or
not there is a train station there for high-speed rail, what transitions are happening there. I think
that may make major transitions to what happens on Alma Street. So I would be leery of making
major changes to the zoning on Alma Street away from retail depending on what happens there.
If for example some of the proposal for under-grounding high-speed rail involve, even if we
don't have a station, involve more intensity of uses that may make Alma Street more viable. So I
want us to consider that more carefully.
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I am in support of Commissioner Lippert's suggestion of theater TDR.
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Vice-Chair Tuma: Okay. Commissioner Holman.
Commissioner Holman: I have just a couple of things. The parking lots, I think they are all
public parking lots but the question is could we go ahead and extend for instance the GF overlay
on them even though they are probably zoned PF. Could we have a PF FG? The reason is
because I guess I have been around long enough that people come up with very clever ways to
get around requirements. I think if we had a GF overlay the intention would be very, very clear
as to what the purpose is should they ever be rezoned. So if Staff could come back with
something about that.
I am not sure of the best way to preserve the theaters is TDRs but I think other communities do
look at ways to preserve their theaters. So I am also interested in that and thank Commissioner
Lippert for bringing that up.
Then in the near distant future we are also going to be looking at basements, which would
include the Downtown area in basements. Do you want us to keep those issues separate or
combine? Keep them separate? We are talking about ground floor here. So keep the issues
separate I would presume.
Mr. Williams: I would think so, yes.
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Commissioner Holman: Okay. That's it. Thank you.
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Vice-Chair Tuma: Okay. I am going to take a stab instead of doing everything by straw poll I
am going to take a stab at summarizing where I think the Commissioners are on various items. If
I get it wrong then tell me I get it wrong. I think we can get the bulk of this out because there
seems to be quite a bit of consensus.
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So here is what I heard. On items one through three the unanimous consensus of the
Commission was that all three of those items should be investigated and potentially part of an
ordinance that comes back. On item four what I heard was with the exception of Commissioner
Lippert who is not in favor of differentiating the others were. I also heard that the Commission
would like Staff to look at whether there should be other categories of businesses to limit
including banks, and that seemed to be unanimous across the Commission. Then the other thing
that I heard was that there should be an examination of theater preservation efforts, whether that
is TDR or otherwise. I hadn't comnlented on that and I would be in favor of it. The only other
Commissioner I think who had not commented on it would be Commissioner Fineberg who is
indicating to me she would also be supportive. Did I get that part right so far, Commissioners?
Commissioner Holman.
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Commissioner Holman: I anl not sure if the comment was specifically intended to be banks or
fmancial institutions, because there is a difference.
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Vice-Chair Tuma: Financial institutions, right, good point. I think the consensus was other
categories including but not limited to financial institutions. So that being said what I heard
beyond that were a host of other ideas, which I saw Staff diligently taking notes on. if there are
any other suggestions that Commissioners made that they would like us to straw poll on I am
happy to do that or if there is any other issues that Staff would like us to straw poll on I am
happy to do that. Otherwise, you could simply take the comments that have been made on board
as things to look at. Commissioners, any need to straw poll on specific items? Commissioner
Keller.
Commissioner Keller: I think it might be worthwhile straw polling on the idea of mandatory
ground floor versus a threshold trigger.
Vice-Chair Tuma: Okay. Don't want to run afoul of any procedures here but I assume that we
do this simply by a show of hands and then I read that into the record.
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Mr. Larkin: I think that is fine as long as you are recognizing that you are not committing
yourselves to anything. Staffwill come back with a recommendation and Commissioners are
free to change their minds because it is a straw poll and not a vote.
Vice-Chair Tuma: Okay. So I guess the Commissioners who would favor essentially a
prohibition on anything other than ground floor retail.
Mr. Larkin: It is really in favor of exploring the concept because there still needs to be outreach.
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Vice-Chair Tuma: Thanks for that clarification. So by a show of hands those that would support
basically a prohibition on anything other than ground floor retail.
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Mr. Williams: So elinlinating the threshold.
Vice-Chair Tuma: Better said, eliminating the threshold. Commissioner Lippert.
Commissioner Lippert: Just a clarification on that. That would also include personal services as
well, correct?
Mr. Williams: Personal services are allowed like retail is allowed so that would be allowed still.
So this is essentially prohibiting the threshold for office.
Vice-Chair Tuma: Okay. Commissioner Keller.
Commissioner Keller: I think the way to think about it is essentially eliminating the exception
process independent of vacancy rate.
Vice-Chair Tuma: Okay. Commissioner Fineberg.
Commissioner Fineberg: This is just that we would be in favor of exploring this process.
Vice-Chair Tuma: They are going to explore it either way. I think the direction was they are
going to explore the various different options but whether there is more of a preference towards
essentially eliminating the threshold. So those who would be in favor of that conceptually raise
their hands. That is Commissioners Lippert, Fineberg, Holman - that would be four
Commissioners in favor of that and one opposed.
Is there anything else that we should straw poll on before we close this item? Commissioner
Holman.
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Commissioner Holman: Just a clarification. Tonight's Chair did a nice job of encapsulating
those things that there were numerous comments on. Some of us make other comments about
other things that people didn't comment on. Will Staff come back with responses and
investigation of those additional comments, like for instance local independent business
incentive or promotion?
Mr. Williams: We will definitely look at all of those. I am not saying we will have any - some
of them I think are ones that probably are outside the scope of being able to do something
quickly on and we will let you know that. Others we will probably be able to handle. So we will
look at all of them and let you know why we did or did not address them.
Commissioner Holman: Appreciate that thank you.
Vice-Chair Tuma: Okay. Commissioner Keller, one last comment before we go on?
Commissioner Keller: Yes. Two other issues. I am assuming we don't need a straw poll for the
issue of whether there should be findings for item two that Staff raised. You will just consider
that and that is not the kind of thing we need to go into.
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I am wondering whether we need to straw poll or not the issue of the potential for amortization
out from uses that are not retail essentially on University Avenue or whether that is something
that we shouldn't weigh in on at this point.
Mr. Larkin: That is outside the scope of what we are doing tonight. So that requires separate
notice so you should not be straw polling on that.
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Commissioner Keller: Okay, thank you.
Vice-Chair Tunla: Okay. With that we will close item three and move onto item four.
Page 30
ATTACHMENT I
Planning & Transportation Commission
September 23,2009
Item 1: Questions from Commissioner Keller:
1. Instead of deleting 18.18.060(1)(1), could a CUP be used to temporarily allow nonretail uses, so as not to lose long-standing retail outside the (GF) district? (There is
successful retail on Emerson between Hamilton and Forest that wouldn't be protected
otherwise.
A Conditional Use Permit (CUP) may be an option, but the ClTP process provides a lack
of certainty to the potential lessee, which could be problematic, and CUPs are not tied to
a specific time period. They may require review, but do not expire, so they could not be
used to temporarily allow office.
There are many examples in the periphery of downtown that show that successful retail
will remain even when not required to do so. Staff is recommending for those locations
where retail is an important part of the City's vision for downtown that the GF zone be
extended. lfthe Commission feels that the block of Emerson between Hamilton and
Forest should be included then that could be discussed.
Planning & Transportation Con1IDission
September 23,2009
Item 1: Questions from Commissioner Martinez:
1. The Downtown vacancy rate has been stated to be 10 -15%. That approaches 1 in 7
properties. Are those vacancy rates including all rentals downtown, including offices
and non-retail and space above the groundfloor?
The formal calculation of vacancy rate for 2009 has not yet been calculated, but staff
estimates it to be at approximately 10% for the total ground floor area (square footage)
within the Ground Floor (GF) Combining District, regardless of current or past use.
Space above the ground floor is not included.
2. I am trying to understand the magnitude of the problem. How many non-conforming
ground floor offices exist in the Downtown area under consideration? How much has
that number increased in the last year?
The Use Exception allowed when the vacancy rate rises above 5% has not yet been used
within the downtown GF Combining District, so there has been no increase in the last
year. The calculation is prepared by the City in the fall of each year and though it is
estimated to be above 5% at this time, no Use Exception may be requested until the
official count has been completed and reported to City Council. Additionally, a Use
Exception would only be allowed at that time if there is a space that has been vacant and
available for at least 6 months. The problem is that, if the vacancy rate kicks in, staff will
receive requests for conversions to office, and it may be very difficult to then require
reversion to retail when the economy improves. Staff has received at least two inquiries
regarding potential conversions.
3. Is there any distinction among Planning's definition offinancial services'? For
example, are Chase and Wells Fargo, Fidelity, and American Express and E*TRADE all
lumped into this category?
No, there is not a particular distinction in the definition, which states that 'financial
services' means a use providing financial services to individuals, firms, or other entities.
The term "financial service" includes banks, savings and loan institutions, loan and
lending institutions, credit unions and similar services. Within the GF COITlbining District
this use would only be allowed with an application for a Conditional Use Permit. The Use
Permit process allows staff to distinguish between each type of financial service relative
to its appropriateness as a pedestrian-oriented use.
4. Planning's meetings with Downtown business and property owners unfortunately
weren't well attended. Are there any documents that provide more insight into how
businesses and property owners are being affected by the unprecedented vacancies and
ground floor offices?
The outreach meetings held by staffwere publicized with notice cards sent to all property
owners for properties within the CD-C and (GF) districts and to all business owners
whose contact information was taken from the most recent membership of the downtown
business improvement district. Staff also attended meetings of the Chamber of
Commerce and Downtown Business Improvement District to discuss these issues. These
two meetings had approximately 12 and 6 attendees, respectively, some of whom were
not in attendance at the outreach meetings at City Hall. Attendees of these City Hall
meetings included some representatives from the Downtown Business Improvement
District, the Chamber of Commerce, as well as large and small property owners, and
multiple local business owners. The following people signed in to one or more of these
City Hall meetings:
RoxyRapp
Bruce Barry
Chop Keenan
Sam Arsan
Jon Goldman
Jim Thoits
Fred Thoits
Jim Baer
John McNellis
Cornelia Pendleton
Anne Senti-Willis
Ed Hoffacken
Faith Bell
Leilani Merrill
Joyce Yamagina
Jeff Selzer
Sherry Bij an
Don Douglas
Ron Nunan
Annie Nunan
Jim Nunan
Rick Barry
Phyllis Munsey
Abraham Khalil
Attached you will find a copy of the handout provided at these meetings which included a
list of questions asked of these attendees in order to receive feedback and input into the
development of the ordinance revisions proposed by staff.
5. There are acceptable GF uses that are quasi-offices, such as travel agents. Is there a
rule of thumb that it's retail if it's open to the public, and it's offices if has little or no foot
traffic?
The definitions (PAMC 18.04.030) of retail services (definition (125)) and offices
(definitions (6), (61), (95), and (116)) provide guidance to staff on this issue, and include
many examples that show the intent of the use categories. For instance, "Retail service"
means a use engaged in providing retail sale, rental, service, processing, or repair of items
primarily intended for consumer or household use. The definition then goes on to list the
types of items that might be sold and a few specific types of retail stores. When an
unusual use is presented that is not specifically included in one or the other definition
staff will discuss which use category it most closely resembles and where it might best
meet the intent of the zoning district. In these cases the amount of foot traffic would
likely be an element considered. In addition there are other uses beyond retail which are
allowed, including "personal service" which means a use providing services of a personal
convenience nature, and cleaning, repair or sales incidental thereto. This definition also
includes a list of example uses, including beauty salons, copying services, film
processing, art and music studios.
Downtown Retail Vitality and Protection
August 25, 2009
Purpose Statement: To Enhance and Protect Downtown Retail Vitality Through
Modified Ground Floor Retail Regulations.
Problem Statement: Existing regulations may allow conversion of ground floor retail
space in the downtown core with vacancies in excess of 5%,
possibly to the detriment of the vitality of retail throughout the
downtown. Also, preserving seemingly marginal retail sites on the
perimeter of downtown may detract from the retail core and/or
result in long tenn vacancies.
Potential Changes:
1. Should the vacancy rate required for use exception request to
allow ground floor office in Ground Floor (GF) combining
district be increased (from its current 5%), or should the use
exception process be removed completely?
2. Should the restrictions in the Commercial Downtown
Community (CD-C) district outside of the GF zone be revised
to allow office space where retail currently exists?
3. Should the GF district boundaries be revised? If so, what areas
should be added to the GF district, and which should be
removed?
4. Are there certain uses that should be limited in quantity in the
downtown core? Restaurants and financial institutions are two
that have been discussed. If so, what limits might be set?

TO: HONORABLE CITY COUNCIL FROM: CITY

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