Let's step "out of the box" with our revenue enhancement options.

Karen White accurately covers the problem and presents a perfectly reasonable solution: inducements for new hotels and protections for existing ones.

But Palo Alto desperately needs to go beyond the conventional.

Kudos to the "Weekly for its latest pioneering effort to engage civic dialogue and for this opportunity to add the following thought process and resultant idea to the mix.

Initial Disclaimer: The following discussion divorces itself from any constraints of current zoning, land-use, unforeseen impacts, immediate objections, and anything that diverts from its seminal thought process. Breakthroughs start with what is engaging and viable, not with what may seem to stand in the way.

Basic Premise:
Palo Alto desperately needs to increase sales tax revenues. [Does any individual in this city dispute this? If so, please explain.]

Key Question:
Now think carefully. What brings people FROM OUTSIDE Palo Alto to spend their hard-earned dollars within Palo Alto? In other words, what is special about Palo Alto from a sales-tax generation perspective?

Possible Answers:
Stanford Shopping Center. University Avenue restaurants. Various specialty stores? .... Anything else?

Process: From Confusion to Light:
I attended the March informational meeting in Council Chambers on a proposed new pedestrian and mass-transit oriented zoning to encourage high-density housing within a wide swath in the California Avenue area between the tracks and El Camino.

Despite planners' best intentions, travel was arduous: a dozen existing zones, a new overlay zone, and the usual arcana of acronyms, abbreviations, and planning minutia.

Two hours into the evening, someone asked about the future of Fry's and a light went on.

Fry's ... narrow access routes; unremarkable structure; potential blight in the city's eyes.

Oh, ... and with a large parking lot, jammed with cars, 7 days a week, up to 13 hours a day, with people from all over, madly shopping ...

Fry's ... a retail magnet

Fry's ... abutting Park Boulevard with its many undeveloped or vacant lots, sitting on the city-owned fiber optic loop and extending north toward Keeble and Shuchat, another magnet.

We've endured an arduous debate over the merits of fiber-to-the-home. But fiber for commercial use is a no-brainer: a few grand to hook up a business.

If Palo Alto is the birthplace and nexus of Silicon Valley, let's show it.

Why not create a walkable environment, a boulevard, that displays the most innovative and viable technology products people will buy now: environmental, automotive, consumer, home, and business. Attract companies that will employ the fiber to showcase its potential and sell their wares.

Incorporate a central meeting site: auditorium for presentations and lectures, broadcasts and screenings, meeting rooms.

Sprinkle in a good dose of interesting places to meet, chat, and relax.

Tech Row, Palo Alto?
Pipe dream or an idea with legs.

The Test: Bring together a group of tech visionaries, entrepreneurs, and established business players into a series of effectively moderated brainstorming sessions. If the idea resonates, you will find out here.

Thank you for reading.
-Fred Balin, 5/31/06

A truly GREAT letter and concept. Soon everyone will see that JOBS (as in the
"jobs-housing imbalance" call for less commercial activioty) is not the problem,
but the solution to Palo Alto's woes.
To you and Karen White, profound thanks.

I’m new to political goings-on, but I’m going to have to disagree with Ms. White. I think part of the problem is the basis on which she begins: that the quality of life in Palo Alto is inextricably linked to the services that the City provides. This assumption would lead to the conclusion that Palo Alto would be no different from any other town were it not for things like single-container recycling or a speedy emergency response.

This, of course, is not the case. Palo Alto’s competitive advantage, as it were, is reliant on a remarkable climate and Stanford University. Fortunately, there is little that other towns can do to re-create either.

But always the fascination with our beloved services. Any reduction is a “sacrifice” or a “slash,” and any attempt to balance the budget by spending less is described as “draconian.” Again, I’m no expert in the way a city works, but the City’s published budget for the general fund and the enterprise fund come to roughly $382 million. Assuming something like 58,000 people in Palo Alto, that means the city spends over $6,500 each year on every man, woman, and child. I have to wonder if we’re getting value for our money.

So I decided to take a quick look at the City’s budget information. I was happy to find that the City says that it did manage to cut $2.1 million from the General Fund for 06-07. A good start. I’m not sure how much my standard of living will be reduced by not giving the City Manager a secretary, by the elimination of contract agency funding, or by the loss of the City’s cable TV show. Somehow my family and I will endure.

My optimism was short-lived, however, because the City apparently has an odd way of cutting its budget. “Total General Fund expense is projected to be $127.4 million in 2006-07, a $2.1 million increase from 2005-06 adjusted budget figures.” Which means that any reductions were offset (at least) by increases in spending elsewhere. This doesn’t much sound to me like a business that knows how to make good or tough decisions.

Which is why I find it puzzling to read opinions like Ms. White’s where the focus of the local government is on trying to micro-manage business decisions for our city. Simply because hotels (or, for that matter, car dealerships) provide large revenue potential does not imply that hotels or car dealerships will want to locate themselves here. And with the recent departure of both, one might reasonably conclude that there is something inherently unattractive about our city to these kinds of businesses. I very much doubt if incentives will be the answer to the problem. If Palo Alto has discovered that hotels can provide revenues, what is to prevent other cities from offering the same incentives?

Why not instead promote business in general and let the businesses decide if Palo Alto - on the merits - is where they should locate? Ms. White wants people to spend money in Palo Alto. I’d love to spend more money in Palo Alto. Unfortunately, each month, I drive across city (and county) lines to buy groceries and other household products. Why are these stores not in Palo Alto? It’s not for a lack of demand or space. Palo Alto simply doesn’t allow it.

Ms. White speaks extensively of the benefits of hotels -- people who stay in them also eat at our restaurants and frequent the PA shops. This cannot be denied. But the real benefit, as described by Ms. White, is that these people don’t actually live here. I used to joke with my wife that the quaint signs that greet you when entering our town should read “Welcome to Palo Alto...now, go home” -- I never seriously thought this would be accurate, but apparently I was wrong.

Palo Alto should focus on the things it can control: good streets, good fire and police services, and a healthy relationship with local businesses (including, of course, Stanford). It is a great place to live and work, and it’s not surprising that others want to come here. We should look at that as a compliment and not a threat or a burden to our infrastructure.