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Council approves Sandhill alternative compliance for 4 Corners mixed‑use project after heated debate
Summary
After more than three hours of testimony and council debate, East Palo Alto approved an alternative‑compliance plan for the 168‑unit 4 Corners mixed‑use project; staff had recommended denial because the proposal provides fewer and shallower affordability levels than the Inclusionary Housing Ordinance requires.
City housing staff (HEART) recommended the council deny Sandhill Property Company’s request for an alternative compliance option on the proposed 168‑unit 4 Corners mixed‑use project. Alex Wagoner and Tim Davis (HEART) told the council the applicant’s plan to provide 25 on‑site units at 80% of area median income (AMI) falls short of the ordinance’s alternative‑compliance standard, which would normally require 31 units with deeper affordability tiers. "As a result, staff has concluded that building 25 inclusionary units for median income households on‑site as an alternative compliance option is a lesser public benefit than is required," staff said.
Mike Kramer of Sandhill Property Company argued the baseline inclusionary requirements make development infeasible on the long‑vacant parcel. Kramer told the council that prior feasibility studies and peer reviews show that strict baseline compliance would likely yield no development; by contrast, he said, the alternative compliance plan would deliver 168 new apartments, 25 deed‑restricted low‑income units, 5,000 square feet of ground‑floor retail and a public courtyard, and the project would produce long‑term tax revenue for the city. He said independent analysis suggests the combined projects proposed by the applicant could yield roughly $18 million in general‑fund revenue over time.
Public comment split the room: residents and housing advocates urged strict adherence to the Inclusionary Housing Ordinance to prevent displacement and preserve deeply affordable units; business and neighborhood speakers said active development would generate tax revenue, infrastructure and safer streets. Council debate focused on whether the developer’s offer constituted greater public benefit than baseline compliance, feasibility evidence and the precedent of approving alternatives.
Councilors ultimately voted to adopt a substitute resolution accepting the applicant’s alternative‑compliance proposal for the mixed‑use project (the council substituted staff’s denial with an approval motion and then voted). The council directed staff to draft required inclusionary agreements and to monitor utilization and affordability outcomes as units are developed. The approval was contentious and several councilmembers stressed that the council should revisit the city’s inclusionary policy when the Grand Nexus and ordinance update are complete.
