Council adds 156 California Ave. parcel to housing sites inventory, enabling negotiated BR2.0 pathway

Palo Alto’s City Council voted on May 18 to add Lot A at 156 California Avenue to the city’s housing sites inventory, a step that allows the property owner to pursue a revised builder’s‑remedy 2.0 application rather than proceed with the higher‑height 1.0 proposal on file.

What the council approved: Planning staff summarized a negotiated ’2.0’ concept that reduced the originally proposed 177‑ft tower to about 144 ft while reconfiguring podium heights and site massing. The revised concept preserves retail at grade (a Molly Stone supermarket), increases some podium heights and the total number of dwelling units slightly, and modifies parking and fee assumptions. Under BR2.0 rules, the baseline inclusionary requirement for on‑site affordable units falls from 20% (the builder’s‑remedy 1.0 baseline cited by the applicant) to 13% (though deeper affordability or additional off‑site contributions can alter outcomes).

Applicant and design team view: Architect Jeff Currant told the council the site is “bar none the highest quality transit‑oriented site that we’ve ever worked on,” pointing to the Caltrain station across the street and the opportunity to orient the supermarket and pedestrian frontage more strongly on California Avenue. Applicant representatives and counsel said the 2.0 design is an overall improvement that better addresses loading, resident amenity space and visibility while enabling more private fundraising and programmatic uses.

Tradeoffs debated: Council members and public commenters framed the decision as a classic tradeoff between lower skyline and better design versus fewer on‑site affordable units and reduced fee revenues. Levers at issue included the affordable‑unit count, development impact fees (applicants indicated developers would pay fewer fees for inclusionary units under the negotiated approach), and estimated off‑site affordable‑housing contributions (staff estimated roughly $2.6 million in public‑art fee reallocation could be contributed to the housing fund under the negotiated approach).

The vote and next steps: After extended deliberation the council voted to place Lot A on the housing sites inventory, allowing the applicant 120 days to file a BR2.0 application and initiating an expedited review path; the motion passed (council recorded the motion as carried 4–2). If the owner submits a BR2.0 application, the city will provide a courtesy review at the Architecture Review Board and then return the formal approval to council.

What remains unresolved: The council acknowledged remaining policy friction: the BR2.0 route reduces the city’s on‑site affordable percentage at this site relative to the original application, and the negotiated design reduces visible height while changing the distribution of units and parking. Council members asked staff to preserve the opportunity to maximize on‑site affordability in later steps and to press the applicant for parking and street‑level improvements.

Why it matters: The decision illustrates the real‑world effect of California’s housing laws that constrain local control over height and density; the council used negotiation rather than litigation to secure design concessions while accepting statutory BR2.0 affordability baselines. The applicant signaled willingness to proceed with the revised 2.0 design and to return with a formal application and design details for review.