Attorney challenges Palo Alto proposal to build affordable units on Lytton Avenue lot
byGennady Sheyner
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An attorney with a long history of challenging Palo Alto’s housing policies has filed a lawsuit in a bid to reverse the City Council’s recent decision to develop affordable housing on a downtown parking lot.
David Lanferman, an attorney with Rutan & Tucker, filed the lawsuit on behalf of a group called Downtown Vibrancy, which he wrote consists of “merchants, businesses, residents, and property owners in the Downtown Palo Alto area, many of whom are the owners of properties that have been assessed for the acquisition, improvement, and maintenance of Downtown Palo Alto parking facilities for decades.”
Lanferman had previously represented downtown developer Charles “Chop” Keenan, who successfully sued the city over its failure to use the parking in-lieu fees it collects from developers for their intended use: adding parking. The city ended up refunding about $900,000 to Keenan and dusting off its discarded plan to build a garage on the corner of Hamilton Avenue and Waverley Street.
In the new lawsuit, Lanferman similarly contends that the city is failing to comply with its own laws pertaining to parking. In this case, he is claiming that the City Council has no right to change the use of downtown parking lots, which had been funded through assessments levied on the property owners in the University Avenue Parking Assessment District.
Since its inception in the mid-1970s, the city had been levying assessments on more than 200 downtown properties. Through these assessments and bonds, Palo Alto was able to add 20 parking lots and build two garages in the downtown area, according to the suit. This includes Lot T on Lytton Avenue and Kipling Street, a site that the council deemed to be ideally suited to accommodate affordable housing. In January, council members selected the nonprofit Alta Housing to build a seven-story development with about 80 apartments on the lot.
Lanferman argued in the suit that this isn’t legal.
“The Defendants’ actions, as alleged herein, are in derogation of the rights and interests of the Plaintiff’s members, who have been assessed to pay for the acquisition, improvement, and maintenance of Lot T and other parking facilities, as well as are in derogation of the City’s public commitments to dedicate those parking facilities solely for the purpose of providing off-street public parking to serve the Downtown community,” he wrote in the suit.
The legal action isn’t entirely surprising. Lanferman had consistently opposed the city’s parking lot plan, which is among the programs that Palo Alto included in its Housing Element, a blueprint for adding 6,086 apartments by 2031. He had registered his opposition in letters to the city and to the Department of Housing and Community Development, the state agency that reviewed and ultimately certified the housing plan. Just before the council was set to vote on the lot conversion in January, Lanferman submitted a letter questioning the legality of the move.
“Notwithstanding the importance of affordable housing, and Palo Alto’s State-mandated need for more affordable housing, it is even more important that the City Council be put on notice and acknowledge that it would be exposing the City to significant legal risks if it proceeds with the threatened actions as this time,” Lanferman wrote at the time. “While the Downtown owners and businesses strongly support well-planned efforts to provide more housing in Palo Alto, such as the ongoing efforts to revise Downtown zoning and development standards so as to allow and encourage housing, the City’s pursuit of housing should not come at the expense of injuring Downtown retailers or disregarding the legal rights of property owners that paid for the purchased and ongoing maintenance of Downtown parking lots over many years.”
He is not the only one who made this argument. John Shenk, CEO of the Thoits Brothers, a property management company owns numerous commercial sites in the downtown area, spoke out against the lot conversions during the Jan. 21 meeting and suggested that the move is legally questionable.
“It is clear there is a huge misunderstanding in the community,” Shenk said. “Lot T is part of the Downtown Parking Assessment District. Lot T is not the general public’s property. It can only be used as a public parking facility until the Assessment District members vote to authorize a change.”
The suit, which Lanferman filed in Santa Clara County Superior Court on April 21, asks the court to rescind the council’s January action and effectively halt negotiations with Alta or any other developer who may be interested in converting downtown lots. He is also seeking a declaration that city officials “breached their fiduciary duties by failing to acknowledge and respect the rights and equitable interests of the owners of properties that have been assessed or otherwise contributed to the acquisition of the Parking Lots.” And he is asking the court to rescind any council direction that would expend parking fees for work relating to the conversion of Lot T to housing.
While some downtown developers formally opposed the lot conversion, all seven council members agreed that the project is worth pursuing. They also asked Alta Housing to build at a greater height than the developer had previously proposed. Council member Keith Reckdahl suggested that the building be as high as it can, while still retaining adequate parking.
“I think parking will be the limit,” Reckdahl said during the discussion of Lot T. “Affordable housing – we have such demand for it. This is a great site. We want to make the most of this lot.”
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Gennady SheynerStaff Writer, Palo Alto Weekly / PaloAltoOnline.com
Gennady Sheyner is the editor of Palo Alto Weekly and Palo Alto Online. As a former staff writer, he has won awards for his coverage of elections, land use, business, technology and breaking news.Gennady...More by Gennady Sheyner
11 Comments
There is a blessing in the lawsuit.
Now all stakeholders may understand the time limits on the entitlements granted by the City to the University Avenue Parking Assessment District(PAD). On behalf other residents in four neighborhoods adjacent to University Ave. Commercial Core, we have personally spent several thousands of dollarsover past years tryng to understand the “ownership” powers granted to the PAD. Are the PAD powers to govern and “own” public properties such as some garages and Parking Lot T intended to be in perpetuity? Or do powers exist only through the life of bonds used to pay for some of the parking lots and garages? When the bonds have been refinanced, what are the terms for the “ownership” powers suggested by Mr. Lanferman presumably on behalf or Mr. Chop Keenan and other participants in the PAD.
The salient issues iare finally coming into public view. What will this city council do? Now the Council’s good intent to develop affordable housing is at stake. This is not the time for City Council to embrace these issues avoided for decades.
Did previous city councils concede Parking Lot T to the Parking Assessment District? Or are Mr. Keenan and other landlords correct in asserting “Lot T is not the general public’s property”.
On behalf of my neighbors in four neighborhoods ajdacent to University Avenue, I want to know. I am getting older by the minute. Life is short except for the entitlements of the PAD.
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Remember PA’s plan to assess these landlords $43,000,000 for spiffy new sidewalks downtown while removing even more parking?
You think they’re eager to pay up that huge amount?
You think removing parking is going to reduce the sales tax gap that our “leaders” are bemoaning while they plead poverty about providing us with basics like fire engines?
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I often head downtown to meet friends at a cafe. There are several within walking distance of the parking lot at the corner of Kipling and Lytton, Parking Lot T. I always find it curious that Lot T, is never full but there is no available parking for anyone who doesn’t have a permit and the permitted parking spaces are mostly empty.
So, it seems this Suit against the City wants to keep these spaces empty at the expense of residents who need a place to live that they can afford. The unnamed people and businesses behind the Suit are happy that the City has to spend money to pay lawyers instead of using that money in other productive endeavors—like making sure we can house everyone in pour community.Enough already.
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You’ll never be able to house “everyone” in one of the most expensive areas in the US. This type of unrealistic thinking is why we’re now stuck with Trump watching democracy be destroyed.
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This type of small and obstructionist thinking is what got Trump elected.
We can have both. Let’s be honest, given our housing shortage, worker shortage, and the cost of land – a surface parking lot is an economically terrible use of space in a downtown area. Council is right to rethink their usage. The city is losing money on the parking garages and surface lots, that isn’t what any citizen wants.
This isn’t an either/or question. Remember, the city is contemplating a new parking garage so that more housing can be built. I should hope the 3-years and $1 million+ we are spending on the downtown housing master plan will address the parking and housing issue. If you care about this issue, get involved with that effort.
I don’t buy that you have to be able to park feet from a business door to shop there, do you do that at Stanford Shopping Center or T&C? No, you find a spot and walk where you need to go. Businesses know that foot traffic (not parking) is the main driver of location choices for tenants.
The proposed Mollie Stones project, with its 600+ new residents within a very short walking distance of all of Cal Ave businesses, might be the only thing that will save that retail area. No amount of parking would do that. So how about the same for University? More housing and more residents/customers who live nearby and shop! Put the parking in a garage.
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I agree with What are we doing.
I live downtown and note that places like Coupa on Ramona are full much of the day though Ramona is closed to cars. As noted above people park (when they can find a space) and walk a good bit at Stanford Shopping Center. I do support adding a new DTN garage at Hamilton and Waverley at the same time we build housing (desperately needed) for low income residents on a small number of downtown surface parking lots.
We can have both sufficient parking and add to our housing stock downtown and around Cal Ave–bringing in residents living nearby to add to foot traffic and buying power in these areas.Log in to Reply
I hope to never see a building on this parking lot. Parking lots are the “open space” of today. The only way to get away from the towering monstrous buildings that are all around is to find a parking lot where you can look across an expanse of flat ground and maybe see across a street and get a little sun.
It used to be “paving over paradise” for a parking lot, now given the overcrowded reality of this state, saving parking lots is the way to go to have some sunlight.
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Personally, and I think many people are like me, I have a couple of favorite parking spots downtown depending where I am going and none of them are outside the business I plan to visit. Generally I browse as I walk to my destination or return to my car. I certainly can’t do that while driving.
What is just as important is the anchors or draws to downtown. For some it might be a restaurant and others a retail business. Whichever it is, the others should benefit from passing pedestrians much more than passing bikes or cars. Having live music can help too. I am always impressed with Castro Street but parking is getting very difficult there at popular times. Parking is important with signage and tech availability signs becoming even more important. If we can’t find the empty spots they might as well not be there.
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Odd that the City Attorney did not advise the City Council that the parcel is part of the Downtown Parking Assessment District.
Just add additional levels of underground parking, to replace the 52 spaces that would be lost. Presumably the new housing project would have already had sufficient underground parking for the new residents, at least one space per unit, unless the City planned to export the parking for the residents to surrounding city streets.
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The city can’t just not develop the site without consequences. From the Housing Element Program 1.4 – City owned lots:
“If the City is not on track to meet the Quantified Objective by 2027, halfway through the planning period, the City will remove these sites and identify alternate sites with zoning sufficient to accommodate any shortfall of units, likely resulting from the Downtown Housing Plan by December 31, 2027 ”
The units in question amount to 290 low-income units. To claw back that many using inclusionary zoning at 20%, they would need to find 1450 units total. That’s a lot to put on the downtown housing plan.
If the city does neither the parking lot program, nor the changes necessary get those low-income units back into their inventory, the city is reneging on a committed program. That likely would lead to decertification of the Housing Element, and new builder’s remedy projects
If I were a change-skeptical downtown resident, I’d be careful what I wished for on these parking lots.
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I am a downtown resident. I support more housing including housing for low income residents in my neighborhood.
I think building the garage at Hamilton/Waverley and adding housing on downtown surface parking lots is a workable solution.
As Scott said above, there will be serious consequences frim HCD if we do not meet the commitment we made in the Housing Element they certified.
Time to move forward on meeting our housing commitments.Log in to Reply
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