10/30/2012 Council Summary – Park Dedication Fees

Very interesting night.

We started the evening with a discussion about our non-residential parking requirements.  When a commercial or industrial development is proposed, the city requires the developer to provide a certain amount of on-site parking, based on the square footage.  Staff is looking into our standards to see if they need some adjustments.  And they are considering lowering the requirements for certain types of businesses, raising them for others, and making some other changes.  For instance, large-scale commercial day care centers don’t have the day-long parking demands that a retail establishment does.  I don’t think I can adequately describe all of the various proposed changes.  But in addition to the above, there was discussion about establishing maximum parking space limits in addition to the existing minimum requirements, as well as talk about paid/metered parking.  There was also some time spent considering “seasonal” parking requirements (such as holiday shopping at larger retail centers).

We then went to the general meeting, and the first order of business was to recognize this year’s winners of the Santa Clara Valley Science and Engineering Fair competition, which was fun.  After that, we swore in Ken Olevson as our newest planning commissioner.

There were no announcements, once again.  The minutes, the list of bills, and the second reading of the ordinance were pulled, sort of, but the second reading of the ordinance was put back on after some confusion was cleared up.  We approved the balance of the consent calendar, including the second reading, on a 7-0 vote, with one “no” vote and myself recused on the second reading of the ordinance (my home is within 500′ of the Fair Oaks proposal).

We then had public comments, which were more of the usual, for the most part.  Nothing striking comes to mind.  Then it was on to business.

Item 2 was consideration of a proposal to build a tenth office building in the industrial complex off of California near Mathilda (where the Libby’s tower is).  The complex in question has about 600,000 square feet of office space divided among nine buildings.  The proposal was a bit interesting, because the owner and developer are proposing decreasing parking on site, gaining access to the public parking under the Mathilda overpass, taking over long-term maintenance of that parking facility, and building some pedestrian improvements to connect up with the Downtown.  The developer would also complete the sidewalk on the north-west corner of Mathilda and California, to complete the path from that bus stop to the industrial complex in question.

There was some discussion about the agreement regarding the parking facility, how permanent that agreement would be, what long-term obligations existed, and so on.  The concern was mostly whether we were locking the city into a permanent situation, or entering into something that can be modified in the future as conditions change.  There was then one speaker opposed to the proposal.  And after some discussion, we approved the proposal on a 6-1 vote (I agreed).

I have some minor concerns about the site.  I’m not thrilled with effectively devoting a public parking facility to a private property owner.  But the private property in question makes very little use of the parking they have on site, so I don’t think that’s an actual concern.  The long-term improvements to the Mathilda parking and the pedestrian access that’s going to be created are terrific, and it will create a direct connection between that industrial complex and the downtown, which is a serious deficiency right now.  I’m also a little disappointed with the loss of private open space on the industrial site.  If you’ve been there, you’ve seen this nice, central open green space, and the new building will cut into that.  But it’s their property, and if that’s what they want to do, then so be it.

Item 3 was the big one, consideration of our policy regarding park development fees.  This is a serious issue involving a lot of money and the way Sunnyvale will look and feel for decades to come.  When a housing developer builds a new project, he is required to either give property to the city for park development, or provide the cash equivalent.  And we are gradually moving towards a standard requirement of five acres for every 1000 residents added by a development.  This is projected to generate some $150 million in park dedication fees over the next 20 years, a substantial amount of money.  Legally, we can use this money to buy land for parks, to build parks, or to replace capital assets on existing parks.  So we could use it to buy the remaining half of the Corn Palace land if it becomes available.  We are using it to pay the $9.5 million for construction of the new Seven Seas Park on Morse Avenue north of 101.  And we have used it to replace the park equipment at Serra Park, Murphy Park, and Ponderosa Park in the past couple of years.  The dilemma is pretty simple.  If we keep using it the way we currently do (primarily for everything buy buying land), we’ll never have money ready to buy land when it becomes available.  If we set large amounts aside to buy land, then we won’t be able to replace park equipment as we’ve been doing, and our parks will degrade in quality.  And if we buy land and replace existing equipment with that money, then we won’t be able to actually build parks on the newly-purchased land.  There is a real need to create a policy about this, rather than continuing our current practice of just spending the money on a case-by-case basis as need arises.

Staff proposed an interesting model, whereby we set aside 20% of the money for buying and building new parks, we use 40% to fund ongoing capital replacement of “community” parks (those that serve the entire city instead of just one neighborhood), and we use 40% to fund neighborhood parks in proximity to where a development happens.  And the city would be broken into north, central, and south zones, to define what “neighborhood” means.  So if some developer pays us $1m in fees for new housing at Fair Oaks and Tasman, we’d save $200k for future park purchase.  We could use $400k for capital replacement at the Rec Center, regional pools like the Washington Pool, repair of the sports fields at Fair Oaks Park, and so on.  And the other $400k would have to go towards neighborhood parks in the northern part of the city.  This isn’t just a functional model – it’s also a legal one.  We have legal obligations regarding how these fees get spent, and we have to make sure we’re obeying the law.  The breakdown staff proposed does that.

But different councilmembers had different priorities.  Some wanted most of the money to go to buying land.  Some were concerned about developing a plan that protects the budget and doesn’t create a non-sustainable park program.  And so on.  One of the concerns is that we continue to maintain a city-wide ratio of five acres of park land per 1000 residents.  Currently, we have 140k people and somewhat over 700 acres of open space.  We’re close to that limit, and we don’t want to fall below it.

This whole topic was so nebulous that everyone had opinions and priorities, but nobody seemed inclined to jump in and make a proposal.  In general, the 20% in staff’s proposal didn’t seem right, but staff really didn’t intend that percentage to be “best practice”.  They set the whole topic up with a framework for discussion, and they made it clear to us that the actual percentages that we adopt are a policy decision that we have to make.  The overall design of staff’s proposal was really sound (the zone concept and the division of expenses into community assets, neighborhood assets, and land acquisition).  They mostly wanted a call from us on what our priorities should be.  And the resulting discussion of our priorities was pretty good.

Honestly, I went into this topic understanding the issues but mostly planning to sit back, see where the discussion went and what proposals came out of it, and follow or oppose someone else’s lead, based on my reaction to whatever developed.  But it appeared to me that everyone else was just as unsure and uncommitted to a specific course of action.  So in my discussion with staff, I laid out the three priorities that I saw, regarding park dedication fees:

  • We need a large pot of money sitting around, so that when land purchase opportunities arise, we have the resources available to buy the land.
  • We need to maintain the capital park assets that we have.  Buying land doesn’t make sense if we cannot maintain the parks that we have.
  • We need to protect the general fund.  We cannot build parks so aggressively that the ongoing maintenance of them becomes an “unfunded mandate” that takes priority in the general fund over critical services like public safety and public works (roads, sewers, water).

And when I spelled this out, there seemed to be agreement among my colleagues that these were our concerns.  I then had something of an “a ha” moment, regarding the first of these priorities.  The 20% plan would have resulted in putting aside $1.5 million for land acquisition per year.  That means it would take us 10 years to save $15 million.  And open space in Sunnyvale runs about $3 million per acre.  So if some five acre site becomes available, we wouldn’t be able to act on it for 10 years.  That seemed bad to me.  So I asked staff what their reaction was to structuring this to “front load” money for park purchase – something like “set aside 60% for the first five years, dropping down lower in later years”, so that that “pot of money” becomes available as quickly as possible.  And staff thought it was an interesting idea.  My colleagues seemed to like it a lot.

Given the uncertainty in all of this, nobody seemed willing to lay out a specific plan of X percentage for A or B or C.  So I made an initial motion, to have staff return to us with a plan that 1) front-loads or otherwise provides for a large pot of money for land acquisition sooner rather than later, 2) proposes how large that pot should be, and 3) takes into account the need to continue to replace capital assets and protect the general fund’s higher priorities.  And this was very quickly seconded and approved on 7-0 vote.  We did mention when approving this that we wanted the final proposal to follow the overall structure that staff proposed.

This was a great discussion about city policy, and it was a lot of fun going through all of the issues and trying to decide what’s best for the city’s long-term park interests.  I think it ended well.  I did have one concern about my “a ha” item.  It struck me as very much “designing from the dais”.  Last-minute ideas like this generally don’t make for good policy, because they haven’t been thoroughly considered.  But given the nature of the motion, we have a chance to more thoroughly consider it when this comes back to us.  Both staff and I have already come up with a way we can achieve the “front loading” in a better way, so  I think it will work out well.

Item 4 involved our agreement with California Sports Center for operating the Fremont Pool.  In short, we have a 10-year agreement with them, which expires in July of 2013.  And the city intends to put the contract up for open bid when it expires, mostly to make sure we’re getting something competitive, but also just to explore our options.  But having this all change in July is somewhat disruptive, since that’s the middle of pool season.  So staff proposed simply extending the existing contract by one month, to minimize disruption to residents who use the pool.  And with little discussion, we approved the contract extension on a 7-0 vote.  There was one point worth noting – one of my colleagues expressed an interest in having the city take over operation of the pool next year without using an independent contractor.  That will be considered as part of next year’s action on this topic.

Item 5 involved a new inter-governmental committee, one involving CalTrain’s modernization efforts.  SamTrans is proposing a new multi-jurisdiction committee to advise them on their efforts, and they want us to appoint a representative an an alternate.  After a little discussion, Mayor Spitaleri appointed me as the primary and Councilmember Davis as the alternate.

We then returned to the consent calendar.  A motion was made to amend the minutes to include some specific language.  But it died for a lack of second, and the minutes were approved as presented by staff on a 6-1 vote.  And the list of bills was approved on a 6-1 vote.

We then had IGR reports and non-agenda comments.  I called out the outstanding performance of our Public Safety representatives in two recent events, the canine competition and the cyberbullying initiative.  A colleague unexpectedly made a motion to have a public discussion of invoking eminent domain to seize the downtown property and resolve the ongoing conflict.  It died for a lack of second, probably for two specific reasons.  First, the city doesn’t have the $200 million or whatever the amount would be to actually invoke eminent domain and seize the property.  Second, discussions of the city’s legal strategy are supposed to happen in closed session, to protect the city.  And in fact, we’ve been discussing our strategy and options in closed session in an ongoing fashion already.  So it wasn’t too surprising that there wasn’t a second for the motion.

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