News

To battle traffic, Palo Alto hikes transportation fees for developers

City stands to raise about $17.2 million by 2030, estimates show

In its latest bid to curb the traffic impacts of new developments, Palo Alto has more than doubled the fees it charges builders for each new car trip that their projects would generate during busy commute hours.

At the same time, the City Council voted at its April 22 meeting to scuttle two existing fees that it introduced about 30 years ago to help manage transportation in the neighborhoods around San Antonio Road and Stanford Research Park. The city has been using these fees to implement traffic improvements in these two specific areas.

The new fee structure, which the council approved by a 5-2 vote, with Councilman Tom DuBois and Councilwoman Lydia Kou dissenting, creates a citywide $7,886 fee for each new peak-hour trip, which is more than twice the current level of $3,700. As such, it creates a new incentive for builders to create programs and install amenities that encourage transit use, bicycling and other alternatives to driving cars.

The new fee was inspired by the city's recently revised Comprehensive Plan, which requires developers to create "transportation demand management" (TDM) programs aimed at reducing car trips by providing building occupants with transit passes, adding bike amenities and encouraging ride-sharing programs. The city is now preparing a new law that would require developers in the downtown area to use such programs to reduce car trips by 45%. In the California Avenue area, they are required to achieve 35% reductions. In Stanford Research Park and on El Camino Real, the required reduction is 30%, while elsewhere in the city it's 20%.

City officials project that the new fees would raise about $17.2 million by 2030, enough to pay for about 4.4 percent of the city's capital costs.

The city's approach to collecting these fees differs markedly from that of many other jurisdictions, which often assess fees based on square footage of new developments. For office projects, these fees vary widely, with Menlo Park charging $4,547 per 1,000 square feet of office space, Los Altos charging $9,994 and Mountain View charging $23,260 for new projects in the North Bayshore area.

Though Palo Alto is taking a different tack by linking its fees directly to new trips, staff estimate that the new fee would rate the city at the higher end. Based on rates these projects typically generate, offices would be assessed about $9,069 per 1,000 square feet while a residential development would pay about $4,416 per unit.

While the council agreed that the city should update its fee to pay for traffic improvements, members had different opinions when it comes to methodology. DuBois argued that Palo Alto should follow the example of others in adopting a fee based on square footage. Basing the fee on peak-afternoon commute times, he said, could result in traffic "spreading out over more and more hours," DuBois said.

He cited the ongoing discussion over Stanford University's proposed expansion, which is currently being reviewed by Santa Clara County. As part of that discussion, the county has proposed shifting how Stanford calculates the success of its "no net new commute trips" policy. Rather than just looking at one peak hour in the morning and in the afternoon, the county would consider traffic levels during three-hour "peak periods."

"There's some intellectual satisfaction in saying that what's driving our peak traffic is what we attach the fees to," DuBois said. "But I think when you go from theory to practice, we've seen some issues."

While Kou agreed his proposed approach, most of his colleagues backed the staff proposal, which emphasizes trips over building area. The council agreed to add exemptions for public facilities, including schools. It also supported exempting accessory-dwelling units, despite Kou's assertion that without adequate mitigation these buildings would have a negative impact on neighborhoods.

"With every exception you make there is consequence and always, it impacts the residents in their neighborhoods," Kou said.

The council majority agreed that the adoption of a new fee is well overdue. Vice Mayor Adrian Fine noted that the council had considered adopting it last year but delayed the action to focus on a citizen initiative to reduce office space. Staff's proposed approach, which focuses on trips, is "more supportive of our TDM initiatives," he said.

Mayor Eric Filseth agreed and said that while he's not opposed to having staff take a fresh look at its methodology, that should not delay the council's adoption of the fee.

"If the answer is, 'We ought to take a look at square footage in the future,' then certainty ... but I think we should pass something tonight," Filseth said.

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Comments

39 people like this
Posted by Curmudgeon
a resident of Downtown North
on Apr 30, 2019 at 12:41 pm

" ... colleagues backed the staff proposal, which emphasizes trips over building area."

So, developers can claim trips reductions, likely using the TDM mirage, and duck the tax while the number of trips stays steady or rises. Slick move there, staff.


22 people like this
Posted by Counting employees
a resident of Evergreen Park
on Apr 30, 2019 at 1:22 pm

Counting employees is a registered user.

With all the traffic woes the developers have brought to Palo Alto, as well as the additional costs imposed on residents who are now forced to pay to administer and buy parking permits in an increasing number of neighborhoods, this is a good start. However, the number of employees each new development will bring will most likely be underestimated until the city takes a good look at modern office usage and updates the decades old standard of 250 sq ft per employee still used to calculate how many parking spaces each new development must provide.


35 people like this
Posted by Anon
a resident of Another Palo Alto neighborhood
on Apr 30, 2019 at 1:29 pm

Posted by Curmudgeon, a resident of Downtown North

>> So, developers can claim trips reductions, likely using the TDM mirage, and duck the tax while the number of trips stays steady or rises. Slick move there, staff.

Ta-da. The "other option", of course, is no new office space. No new office space, no fake trip reduction required.

In the meantime, the proposal would tax new residential units at about $4400 per unit, while taxing office space at likely less than $2250 -per job- based on how small the cubicles are going to be. Once again, we keep saying we want to encourage residential development, but, the per-person tax is about the same. How about we don't tax residential at all, and, double the tax on office space. That would still be less than Mountain View is charging for new office space in the North Bayshore area, according to the article.

-No new office space.-


13 people like this
Posted by Resident
a resident of Another Palo Alto neighborhood
on Apr 30, 2019 at 1:32 pm

Looking at daily trips when many companies only expect their employees to be in the office on 2 or 3 days each week (and then week at home or have alternate Fridays off) make a nonsense of these numbers,

Additionally, there is a difference between employees, contractors, part time, job sharing, shifts, seasonal staff, etc. that also mess up any number count.


26 people like this
Posted by P. Anders
a resident of Atherton
on Apr 30, 2019 at 3:23 pm

A step in the right direction. Keep stepping.

Palo Alto needs policy which will make it exceptionally painful to continue adding new commercial space in our overcrowded town. Maybe then, companies will take real steps toward considering other regions/locations to relocate to and grow.


13 people like this
Posted by Invisible Hand
a resident of Atherton
on Apr 30, 2019 at 3:28 pm

@ anders, 100% agree.

Maybe we can use this same tool to slow/stop the construction of these dreadful backyard apartment units:

permit fee $20,000
transportation impact fee $100,000 (adjust up as needed)


16 people like this
Posted by College terraces
a resident of College Terrace
on Apr 30, 2019 at 4:14 pm

The fee can only improve the paycheck of people. I do not see how it can help with bad traffic.


10 people like this
Posted by Resident
a resident of Midtown
on Apr 30, 2019 at 4:47 pm

The irrational War on Cars continues, but who minds if they can make some extra money off it??


30 people like this
Posted by actual resident
a resident of Midtown
on Apr 30, 2019 at 5:11 pm

How much will I get for my additional wasted time sitting around in the increased traffic caused by the increased development?


10 people like this
Posted by Resident
a resident of Midtown
on Apr 30, 2019 at 6:05 pm

Because "incentivizing" and "encouraging" doesn't guarantee anything but who cares if people are getting paid on the side?


25 people like this
Posted by Forester Donlon
a resident of Los Altos
on May 1, 2019 at 2:40 am

It might not make any sense for a growing city to narrow roadways and lessen driving lanes for motorists unless one understands the United Nation's Agenda 21 plan. Palo Alto adopted the UN's Agenda 21 to promote commuters switching from motor vehicles to bicycles and walking. Paradise, CA narrowed down driving lanes. Residents of Paradise could not evacuate during the Camp fires because they got stuck in traffic jams on Agenda 21 roads.


4 people like this
Posted by Anon
a resident of Another Palo Alto neighborhood
on May 1, 2019 at 8:36 am

Posted by Forester Donlon, a resident of Los Altos

>> Residents of Paradise could not evacuate during the Camp fires because they got stuck in traffic jams on Agenda 21 roads.

I would like to remove parking along ECR from University to San Antonio, realign keeping 3 lanes in each direction as now, and, build VTA light rail from Mtn View to University in the median, as was done in San Jose. "They" keep saying they want the ECR south to Mtn View to be a "transportation corridor". OK, let's do it, and, pay for it with transportation taxes of various kinds, new and existing.

-After- this new VTA line exists, it would make sense to start talking about new higher-density affordable housing along ECR.



14 people like this
Posted by So much to unpack.
a resident of Duveneck/St. Francis
on May 1, 2019 at 11:11 am

So much to unpack. is a registered user.

Providing VTA service on ECR that runs parallel to the existing north-south Caltrain line is sort of silly. What we need is bus service that connects to and coordinates with trains and their schedules so people can get to the train to use it more easily. Maybe if our transit was controlled by one agency instead of VTA, MTC, Caltrain and (in the case of ECR, Caltrans)--the agencies would coordinate instead of competing. VTA is the worst of them. Disrupt VTA. Create one transit agency for the region...like they do in Europe where transit works.

I agree with this statement, "...the number of employees each new development will bring will most likely be underestimated until the city takes a good look at modern office usage and updates the decades old standard of 250 sq ft per employee still used to calculate how many parking spaces each new development must provide." Why is City Council not fixing this glaring problem?


3 people like this
Posted by To battle traffic...
a resident of Adobe-Meadow
on May 1, 2019 at 12:00 pm

People in cars decide to not use them for every single trip.

There, I fixed it to reference the only thing that would ACTUALLY work: Reducing the amount of cars on the road.


Like this comment
Posted by musical
a resident of Palo Verde
on May 1, 2019 at 12:29 pm

Does the DMV know how many vehicles are registered to Palo Alto addresses?


15 people like this
Posted by Chip
a resident of Professorville
on May 1, 2019 at 12:53 pm

increasing developer fees mainly increases commercial rents, insuring that only big rich companies (or well-fund start-ups) can afford the space. Of course the money counters in the City of PA get to rub their hands with glee as they tot up the incoming dollars.
Palo Alto already has too much office space, encouraging higher residential & office density, mostly unattractive, housing & further adding to the number (not amount) of cars jamming our old, narrow roadways.

I've said before that we need to stop all non-residential development & restore setbacks, FARs, height limits, & zoning regulations for residences. Allowing new granny units adds parked cars on our streets & in some cases adversely affects the daylight planes for neighboring homes. My vegetable garden in raised, sprinklered beds doesn't get sun anymore.

The "granny" unit? It's actually an AirBnb, which violates the spirit & reason behind long established R-1 zoning.

And, as said by Anon, ban parking on ECR from University to Los Altos Ave.


7 people like this
Posted by commonsense
a resident of Professorville
on May 1, 2019 at 7:01 pm

stick a fork in PA its done.
the developers could give a rats "arse" the city has lost its way and the people running it have all been bought by the highest bidder of what ever side they cowtow to...
this town is a farce...


Like this comment
Posted by Anon
a resident of Another Palo Alto neighborhood
on May 2, 2019 at 8:10 am

Posted by commonsense, a resident of Professorville

>> stick a fork in PA its done.
>> the developers could give a rats "arse" the city has lost its way

That's what they said back in the mid-60's, too:

Web Link

A video series that is about the entire Bay Area but apropos also:

Web Link

But, seriously, this isn't all about looking back. It is also looking forward to a fossil-fuel-free era of renewable energy for all-- and limiting climate change. I'm not giving up as you suggest that we do.


Like this comment
Posted by @Chip
a resident of another community
on May 2, 2019 at 10:43 am

"I've said before that we need to stop all non-residential development & restore setbacks, FARs, height limits, & zoning regulations for residences. Allowing new granny units adds parked cars on our streets & in some cases adversely affects the daylight planes for neighboring homes."

In other words, build housing, but don't build any housing.


6 people like this
Posted by Anon
a resident of Another Palo Alto neighborhood
on May 2, 2019 at 10:52 am

Posted by @Chip, a resident of another community

>> In other words, build housing, but don't build any housing.

- Neighborhoods matter.
- Don't build any more office-space.
- Build housing in appropriate locations.
- Build taller multi-family housing near other tall buildings; don't force it into the middle of 1-2 story single-family home neighborhoods.
- Neighborhoods matter.

I'm very serious about the last item. Many advocates for blanket "housing" don't seem to understand that many of us out here live in actual neighborhoods with actual neighbors. Don't just "do something" -- do the right thing.


Like this comment
Posted by @Anon
a resident of another community
on May 2, 2019 at 11:17 am

The right thing is to build housing. Not to cater to a bunch of multi-millionaires screeching about neighborhood character.


7 people like this
Posted by Anon
a resident of Another Palo Alto neighborhood
on May 2, 2019 at 11:39 am

Posted by @Anon, a resident of another community

>> The right thing is to build housing.

Why is it "the right thing" to build housing in an un-smart way, as opposed to a smart way? You say that is "the right thing". On what moral basis? Just repeating the word "housing" over and over is meaningless.

As an example of how it was done smartly in the past, there is a part of Ventura that was laid out in the 1930's. It is the section between Matadero Creek and Ventura, across from Barron Park. By 1948, most of the single-family lots were filled in**, and there were apartments, 2-4 lots worth, set well back from the businesses along ECR. Sometime between 1948 and 1978, the alley configuration was changed and the Curtner and Ventura apartments were added. I first noticed the neighborhood around 1978 and it was mostly the way it is now.

ECR was and is busy and noisy. Gas stations, restaurants, various businesses all along that section. Some of the businesses are mixed-use with apartments upstairs. Then an alley. Then apartment buildings. Then 1-2 story single-family homes. It makes sense from a -neighborhood- point of view. It preserves the daylight plane for single-family homes. It provides significant affordable housing in the apartments. Overall, it made a great deal of sense to lay things out this way at the time.

Now, developers keep salivating over the area and proposing what used to be called urban renewal. That is, we now know, gentrification. Don't talk to me about "housing", talk to me about affordable housing. Nobody wants to build it because it doesn't pay. Gentrification of that part of Ventura will -reduce- the available affordable housing, as we are seeing in Mountain View right now.

"Housing" has become meaningless, a "motherhood and apple pie" invocation. What real people actually need is affordable housing, and builders can't afford to build it anywhere in the bay area because construction costs are too high.

==

** You can see this on the Google Earth historical imagery function, which has 1948 and 1991 aerial photographs for the area.


13 people like this
Posted by Resident
a resident of Another Palo Alto neighborhood
on May 2, 2019 at 12:05 pm

Doing the "right thing" means that those who live here should be considered and not those who wish to live here. Most of us living here have our wishes ignored so many times. From losing things like the Bowling Alley, the Community Garden in Midtown, and various other well used amenities, we are not having our voices listened to. Palo Alto does not have infrastructure to carry a big increase in population and trying to squeeze more people into our town does nothing to ease some of the problems of traffic, parking, transportation, shopping, recreation, water, sewers, utilities, etc.

The right thing means that residents needs are continued to be what the CC and planning boards should be considering.


6 people like this
Posted by Curmudgeon
a resident of Downtown North
on May 2, 2019 at 4:56 pm

"The right thing is to build housing. Not to cater to a bunch of multi-millionaires screeching about neighborhood character." - Posted by @Anon, a resident of another community

Show us how it is done, O Enlightened One. Build tons of exemplary housing in your own community. Ignore the screeching about neighborhood character. Invite us to behold thy shining marvel.

In the meantime, I shall breathe normally.


1 person likes this
Posted by No housing in palo alto
a resident of Community Center
on May 2, 2019 at 6:45 pm

The daily post reported today that Mountain View approved in 2 hours more housing than Palo Alto has approved in 5 years. No surprise given comments from curmudgeon above and the actions of council members Burt, Holman, Ku, filseth and Dubois.


10 people like this
Posted by Anon
a resident of Another Palo Alto neighborhood
on May 2, 2019 at 9:37 pm

Posted by No housing in palo alto, a resident of Community Center

>> The daily post reported today that Mountain View approved in 2 hours more housing than Palo Alto has approved in 5 years.

Do you have a pointer to that article? I looked and couldn't find it, but, "ironically", I found an article describing a wonderful new development at Broadway and Woodside Rd in Redwood City, with 520 apartments. The catch? 420,000 square feet of new office space-- at least 1,680 jobs, more likely far more than that.

We have too much office space already, and, this project will make the jobs/housing balance worse. Par for the course.

-No new office space.-


14 people like this
Posted by mauricio
a resident of Embarcadero Oaks/Leland
on May 3, 2019 at 6:40 am

mauricio is a registered user.

Mountain View is a company town and will approve as much housing as Google orders them to approve. Mountain View now resembles a depressing human sardine can. Hopefully, Palo Alto will never use Mountain View as a model for anything.


9 people like this
Posted by Rob
a resident of Downtown North
on May 3, 2019 at 9:18 am

I agree that new development needs to encourage mass transit options, but the current 'stick', $17.2 million collected by 2030, is absolute chump change. Period. And of course, the city is the chump, again. Excessive development is the problem, excessive development fees is one possible method to curb that excess. In the mean time, Palo Alto is sticking to its traditional coin operated status with respect to new development. They ought to consider upping the ante to a dollar operated city govt.


3 people like this
Posted by No housing in palo alto
a resident of Community Center
on May 3, 2019 at 9:50 am

Sorry, Mauricio, Mountain View has taken reposnsibilty and tried to fulfill its housing needs. Palo Alto meanwhile has allowed people like you and self serving egostitical council members prevent reasonable housing proposals to wither and die.
Palo,alto a sardine can!!!! LOL. Have you drhad gen around Palo Alto and seen how many single family homes there are and how much land they occupy ? Of course your argument is the way of thinking used to stifle any attempts to build housing in the Duchy of palo alto


Like this comment
Posted by @Resident
a resident of another community
on May 3, 2019 at 10:12 am

"Doing the "right thing" means that those who live here should be considered and not those who wish to live here."

Palo Alto is not a gated community despite your every wish to make it so through your perception of how local government should operate. The more that job-rich cities like Palo Alto fight housing development, the more need there is for the state to step in to make sure it gets built.


7 people like this
Posted by Resident
a resident of Another Palo Alto neighborhood
on May 3, 2019 at 10:32 am

To the above poster who addresses his comment to me, I ask whether you read the whole of my comment and understand my reasoning.

I went on to explain that we do not have the infrastructure to support an influx of new residents. I am not suggesting putting up walls or gates, but I am suggesting that unless our infrastructure can be expanded then it is a great mistake to increase the population as all will suffer from weakened facilities. We don't even have efficient shuttles to our secondary schools and unless a student bikes sometimes 5 miles, many are left with no alternatives but to use a car to get to school. The same can be said for the school staff also.

I have recently traveled to many modern cities in various places in the world. What strikes me from these modern cities is how much the infrastructure has been improved. I can't feel that the populations have increased, probably they have, but I see signs of all these places building infrastructure and improving things like roads, traffic, parking, utilities, services, transportation, and using technology (probably invented by Silicon Valley) to do this. It amazes me what people in other cities do with their phones, their credit cards, their buses, their trains, etc. Instead, we are still using 20th century methods to do the simple things like pay for parking, or wait for a train or bus.

If we had lots of improvements to infrastructure I would be much happier in increasing the population.


Like this comment
Posted by @Resident
a resident of another community
on May 3, 2019 at 11:23 am

I understand that you're making a bad faith argument because you have no intention of actually pushing for infrastructure investments that would meet the disingenuous requirements you've laid out for you to support more housing. And that if, by magic, that infrastructure was popped into existence, you'd go to next item on your list to argue against more housing construction.


2 people like this
Posted by Curmudgeon
a resident of Downtown North
on May 3, 2019 at 11:57 am

"To the above poster who addresses his comment to me, I ask whether you read the whole of my comment and understand my reasoning."

Understand this key fact: that poster desperately wants housing built in "job-rich cities like Palo Alto" because they fear housing would otherwise get built in their privileged enclave. It's that simple.


2 people like this
Posted by Anon
a resident of Another Palo Alto neighborhood
on May 4, 2019 at 1:34 pm

Posted by @Resident, a resident of another community

>> if, by magic, that infrastructure was popped into existence, you'd go to next item on your list to argue against more housing construction.

Here is a -serious-, but, politically impossible proposal for you.

=> Convert the Stanford Research Park, which is about 700 acres - 1.09 square miles, into housing. Remove the approximately 10M square feet of mostly office space, and the nobody-seems-to-know-how-many (anybody? 40,000?) associated jobs. Build around 25,000 housing RM-40 housing units and some amenities - schools, parks, a library, etc.).

Jobs/housing imbalance more or less solved.

BTW, who came up with the idea that the jobs and housing in every city were supposed to balance? That was never the case since the auto became dominant, and, it won't be the case as long as the auto continues to be dominant. So, how did it come to be some kind of regional/state policy?


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