News


Palo Alto approves bond sales to fund Cal. Ave. garage

Council majority authorize sale of up to $50 million in 'certificates of participation'

The Palo Alto City Council authorized staff on Oct. 15, 2018 to sell up to $50 million in bonds for construction of a new parking garage at 350 Sherman Ave. Rendering by RossDrulisCusenbery.

Palo Alto's plan to build a six-level garage near California Avenue advanced on Monday night when the City Council authorized the issuance of up to $50 million in bonds to finance the construction of the long-awaited project.

The council voted 6-2, with council members Adrian Fine and Cory Wolbach dissenting and Mayor Liz Kniss absent, to approve the financing mechanism for the parking structure, which will go up at 350 Sherman Ave., near Birch Street. The project is being approved in conjunction with Palo Alto's new public-safety building, which would be built on an adjacent lot at 250 Sherman Ave., immediately after the garage is constructed.

The new garage will include four levels above ground and two underground levels, with a total of 636 public parking spaces. It will go up on a city-owned parking lot and will provide about 310 new parking stalls to the California Avenue business district, according to Administrative Services Department staff.

The bonds in this case are certificates of participation, which do not require voter approval. Under this financing mechanism, the city will lease one of its properties to the Palo Alto Public Improvement Corporation, a separate legal entity that the city created in 1983 to help finance projects. The corporation would lease the property back to the city, which would make lease payments. The city's trustee would then issue the certificates of participation, which would effectively represent the rights of bond purchasers to collect a portion of the city's lease payments.

In this case, the property that the city will lease is the Rinconada Library (because members of the City Council also serve as the board of directors for the Public Improvement Corporation, they would essentially be leasing the building to themselves).

While the Monday discussion was focused on financing the project, Councilman Adrian Fine took the opportunity to voice general opposition to the new garage. Fine has also said that he opposes the proposed downtown garage, which is also included on the council's infrastructure plan (along with the California Avenue garage, the public safety building, two rebuilt fire stations, a bike bridge over U.S. Highway 101, the streetscape project at Charleston/Arastradero and various bike and park projects).

Fine took issue with both the idea of building new garages and with putting up Rinconada Library as a collateral for this project.

"We're essentially incentivizing people who drive to downtown and California Avenue. … I think we have better use of our money and our land in this city," Fine said.

Wolbach, who opposes the downtown garage but supports the California Avenue one, had narrower concerns. He said he is not comfortable with the financing plan and argued that the garage should be paid for through permit fees (the city is, in fact, planning to require permits for long-term parking at the garage).

Other council members had no such objections.

"The neighborhood is excited to get this done," Councilman Greg Scharff said. "The merchants are excited to get this done. I'm glad we're moving forward."

Vice Mayor Eric Filseth acknowledged the council's differing opinions about the need for new garages but noted that the decision to construct the California Avenue has already been voted on. He chided those opposing the issuance of bonds for trying to impede the project based on broader policy disagreements.

"In my view, to impede the implementation decision in an attempt to reverse the original decision is undisciplined," Filseth said. "And I don't think it's a good process for us to do."

Related content:

Palo Alto gets set to build new California Avenue garage

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Comments

25 people like this
Posted by resident
a resident of Midtown
on Oct 21, 2018 at 10:52 am

Sounds like a scam to me. Why couldn't they set up a special tax on the local businesses that benefit from this garage to pay off the bonds? Maybe give those businesses discounted parking rates.


3 people like this
Posted by sounds reasonable
a resident of College Terrace
on Oct 21, 2018 at 1:40 pm

If the CC is determined to erect a new public safety building in Mayfield, we absolutely will need a new parking structure. I'm not sure what "better uses" Fine has in mind.


22 people like this
Posted by An Investment Opportunity
a resident of College Terrace
on Oct 21, 2018 at 1:48 pm

> Sounds like a scam to me. Why couldn't they set up a special tax on the local businesses that benefit from this garage to pay off the bonds?

Because PACC wants quick/easy cash. Palo Alto is a wealthy town so paying off bond interest is no big deal. Besides, most PA residents will forget about this measure in a matter of weeks any way.

On to the next item on the agenda... another garage anyone?


29 people like this
Posted by Another Giveaway
a resident of Another Palo Alto neighborhood
on Oct 21, 2018 at 9:14 pm

The real beneficiaries of the garage are the handful of people that own most of the commercial real-estae along California Avenue and the real-estate developers planing to build under-parked stack-n-pack in the area.

Restaurant rents are based on the number of seats the location provides. When Cal Ave was gentrified with wider sidewalks the property owners raised the rent on all of the restaurant locations to capitalize on all of the additional sidewalk seating.

[Portion removed.]


4 people like this
Posted by Less than perfect, but this was the compromise.
a resident of Duveneck/St. Francis
on Oct 22, 2018 at 11:25 am

Less than perfect, but this was the compromise. is a registered user.

Some of this new garage parking will replace parking that will be taken when the new, long-awaited and badly needed Public Safety Building is constructed on an existing Cal Ave.city-owned public parking lot. The new building will, of course, add new demand for parking space. The parking garage has to be built first.

It's probably a bigger garage than we need, but that was the compromise that was struck with local residents and businesses in order to get the public safety building approved. I hope City Council will implement paid parking throughout the Cal Ave area, including this new garage.

We don't live in a perfect world. When many constituencies have competing needs and demands, compromise is often the only path forward.

We NEED an emergency operations center that meets seismic safety regulations. We need safe and up-to-date evidence handling facilities. PAPD needs a facility that enables efficient operations. This need was well-documented in a Blue ribbon Committee Report over 15 years ago. We are finally making progress. Let's get it done!


Like this comment
Posted by Anon
a resident of Another Palo Alto neighborhood
on Oct 22, 2018 at 12:18 pm

Count me among those confused by the financing in this case. Is this basically a revenue bond paid for by the following revenue ____?_____, or, just general Palo Alto taxpayer property tax revenue (in which case, what is being cut?), or, something else? We need the new Public Safety building, but, I'm still confused.


8 people like this
Posted by California Avenue Local
a resident of Evergreen Park
on Oct 22, 2018 at 1:57 pm

>> I hope City Council will implement paid parking throughout the Cal Ave area, including this new garage.

Why? Parking should remain free along the streets and existing city parking lots in the California Avenue district. A free 2-hour limit is reasonable.

As for the new garage, if they want to charge for parking so be it. I won't be using it anyway.



8 people like this
Posted by Curmudgeon
a resident of Downtown North
on Oct 22, 2018 at 9:20 pm

"Count me among those confused by the financing in Itthis case. Is this basically a revenue bond paid for by the following revenue ____?_____, or, just general Palo Alto taxpayer property tax revenue (in which case, what is being cut?), or, something else?"

It's simple if you don't think too much about it. You won't understand it if you do think about it.

Suppose you want to buy a yacht, but you don't want an item for yacht payments in tour household budget. Costs too much.

So you rent your garage to me for, say, $1,000/month. You still need to use your garage, so I rent it back to you for $2,000/month. I take the $1,000 difference and make your yacht payments on your behalf.

Presto, you are a financial wizard. The yacht is financed from your normal household expenditures without actually appearing in the budget.

Don't think, just believe.


8 people like this
Posted by RE Agent
a resident of Palo Verde
on Oct 23, 2018 at 2:55 pm

Will the new garage have valet parking available?

Unlike many people, my time is very valuable.


13 people like this
Posted by Another Giveaway
a resident of Another Palo Alto neighborhood
on Oct 23, 2018 at 6:20 pm

Palo Alto has devolved into a class system consisting of lords (wealthy commercial property owners and developers) and commoners (residents).

The lords think they have a birth right to take anything they want from the simple minded commoners (for their own good), and offer the flimsiest of excuses since the commoners are to simple minded to understand a slick real-estate scam, and well... because it really doesn't matter anyway since the lords own the people that make the laws.

If a commoner wants to speak to city council they are given 2-3 minutes to speak, depending on the number of items on council's agenda. If a lord wants to speak to city council, they are given an early agenda slot and 20-30 minutes to speak no matter how many items are on the agenda.

If a lord want to block a busy road and use it as a construction site, they just set up some orange cones and the commoners line up to pass at the lords pleasure. If a commoner blocks a busy road they get tasered and sent to jail.


17 people like this
Posted by Palo Alto Serf
a resident of Old Palo Alto
on Oct 23, 2018 at 6:33 pm

> The lords think they have a birth right to take anything they want from the simple minded commoners (for their own good)...

The lord mayor/Sheriff of Nottingham along with her court of municipal sycophants + some enterprising land barons are in full command of Sherwood Forest.

So where's Robin Hood?


10 people like this
Posted by Another Giveaway
a resident of Another Palo Alto neighborhood
on Oct 23, 2018 at 10:13 pm

If a commoner (resident) wants to build something they are required to meet the spirit and letter of Palo Alto's strict zoning ordinance. If a lord (developer) wants to build something they just make up their own zoning (PC zoning) or go to council and get an exemption to the existing ordinance.


Like this comment
Posted by Love to BIKE!
a resident of Old Palo Alto
on Nov 12, 2018 at 10:09 am

Wait, weren't we all JUST complaining about traffic?

“The definition of insanity is doing the same thing over and over again, but expecting different results”.....

So instead of building housing units at the site (imagine 200+ built-in, full-time residential customers for Cal Ave) with a below-grade public/private shared parking garage that could have been partially paid for by a project, we went un-innovative and backward-looking and built a trip-inducing parking garage. What?

Parking garages are a relic. No city in their right mind is building them anymore, rather most Bay Area cities are REDUCING parking requirements overall. Transportation is changing and instead of responding in a smart-growth way, we used taxpayer money to subsidize people who are close enough to bike and walk to get in their car and have lunch. Sad.

We can do better. That downtown garage must NOT happen.


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

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