Palo Alto City Council adopts new two-story housing rules
The unanimous vote makes interim SB 9 and SB 450 rules permanent and raises the allowable second-floor area from 35% to 40%.
Two hosts walk through the week’s edition in conversation — council adopts sb 9 and sb, commission recommends reservation charge for large, and what’s coming next. Generated by Aware, from this week’s verified summaries.
The Palo Alto City Council put objective standards first for two-story homes, while keeping individual review available as an alternative.
Two-story housing rules are now written into the city code. The Palo Alto City Council unanimously adopted changes implementing SB 9 and SB 450, making permanent regulations first adopted on an interim basis in January 2025. The ordinance puts objective design standards directly into the code and presents them as the first option for two-story homes, with individual review as an alternative. Existing development standards still apply.
The changes allow second floors to occupy 40% of a home's total allowable floor area, up from 35% under the previous standards. They raise the maximum height for low-pitched roofs from 22 feet to 23 feet and allow small second-floor balconies. The ordinance adds flexibility for corner and oversized lots and clarifies the rules for garages and driveways. For SB 9 projects created through an urban lot split, it sets a maximum of two units per property.
A homeowner asked the Palo Alto City Council to remove or modify a restriction tied to nearby garage placement. The adopted ordinance includes a separate clarification to its balcony privacy-wall language. The Planning and Transportation Commission (PTC) had unanimously recommended approval with minor changes on September 30. That commission also suggested future standards to preserve historic districts under a different state law; city staff proposed bringing that work forward next year.
Commission recommends reservation charge for large electric loads
Large requests for electricity could soon carry a charge to hold grid capacity. The Utilities Advisory Commission voted 4-1 to recommend that the Palo Alto City Council conceptually approve a voluntary reservation agreement and fee framework. City staff described competing requests for limited substation and sub-transmission capacity, particularly from loads of 2.5 MW or more. Staff said roughly 20 MW of requests were actively seeking connections.
The proposed charge is about $38,000 per MW per year, typically for a three-year reservation. City staff based it on the depreciated value of existing capacity and said it could discourage applicants from reserving more power than they need. A reservation would come before a separate agreement covering construction work, customer deposits and cost sharing. Setting the fee would require Palo Alto City Council approval.
Utilities Advisory Commission members questioned whether the charge should instead reflect future investment costs and whether customers should receive a credit toward infrastructure costs. The dissenting commissioner warned that existing customers could subsidize new large loads unless the city calculates their incremental costs. Commissioners requested updates on how the program performs.
Resident asks Palo Alto City Council for campaign records
A resident showed the Palo Alto City Council images about a ballot measure campaign and questioned its advertising during non-agenda public comment. The resident asked for appraisal and campaign information and urged people who had not voted to consider the material. The source reports no council action on the request.
The request sought information a voter could use to assess campaign claims before casting a ballot.
Economic Development Committee backs three downtown pilot events
The Palo Alto Economic Development Committee voted 2-0 to recommend expanding the entertainment zone to a car-free downtown street segment. Its recommendation calls for three pilot events ending no later than 9:00 p.m., followed by a staff report to the committee.
The pilot would test outdoor events while giving nearby businesses an early review of hours and impacts.
Utilities Advisory Commission reviews preliminary rate projections
The Utilities Advisory Commission reviewed preliminary FY2028 projections for electric, gas, water and wastewater rates. City staff lowered the projected wastewater collection increase from 14% to 12%, while commissioners asked for clearer breakdowns of costs, revenues and reserves before final rate proposals return.
Those projections will help determine future utility bills, including the cost of sewer repairs and wastewater treatment.
Planning and Transportation Commission favors street-level bike lanes
The Planning and Transportation Commission (PTC) unanimously preferred street-level bike lanes in an informal poll on the transit-center connection's 60% design. City staff said the raised-lane alternative would add approximately $284,000 and at least six months; construction could begin in late 2027 or early 2028, pending state approval.
The choice affects bicycle crossings, project costs and when a more direct route for buses might open.
- Palo Alto City Council. A homeowner rebuilding on Emerson Street asked Council to amend the proposed SB 9/SB 450 ordinance to remove or modify the contextual garage placement restriction for projects using the two-story objective design standards, citing design impacts and neighborhood context.
- Palo Alto City Council. A speaker congratulated a campaign effort, alleged receiving AI calls, criticized specific council members with personal accusations, and reiterated calls for a ceasefire and to stop the war in Gaza.
- Palo Alto City Council. A resident urged the Council to cover Flock cameras, citing privacy and civil rights concerns and the risk of data being used by ICE. The speaker also urged the Council to condemn ICE staging at Elmwood and ask the County to enforce an anti-staging policy.
- Palo Alto City Council. A resident objected to statements attributed to a council member that the resident’s claims about redlining were disingenuous, described their family’s experience with housing discrimination, and requested an apology for attempts to discredit them.
- Palo Alto City Council. A resident presented multiple images related to a ballot measure campaign, argued the measure should not be allowed to fail without a determinate agreement between parties, and questioned campaign advertising practices, requesting disclosure of appraisal and campaign information.
What we didn’t fit in this Sundays edition
Palo Alto had 32 more items this week. Here are sixfour — the rest are on Aware.
- GOVERNANCECommission revises utility reserve management practices. The commission approved a revised wastewater collection capital reserve approach and rejected proposed new distribution-side rate stabilization reserves for electric, gas and wastewater. It directed staff to revisit the water reserve through the water rate study; no one spoke during public comment.
- GOVERNANCECouncil reviews greenhouse-gas inventory and climate-plan indicators. Staff reported that community greenhouse-gas emissions were 49.5% below the 1990 baseline and reviewed progress on transportation, natural gas, electrification and climate-plan indicators. Council discussed EV adoption, multifamily charging, data gaps and a possible regional transit measure; no one spoke during public comment and no formal action was taken.
- GOVERNANCEPublic Comment (Non-Agenda): Flock cameras, privacy, and ICE staging at Elmwood. A resident urged the Council to cover Flock cameras, citing privacy and civil rights concerns and the risk of data being used by ICE. The speaker also urged the Council to condemn ICE staging at Elmwood and ask the County to enforce an anti-staging policy.
- GOVERNANCERecommendation to City Council to adopt proposed ordinance modifying municipal code sections for TDR/CS zone historic incentives (51 Encina Avenue). The commission voted to recommend that City Council adopt the proposed ordinance modifying municipal code sections related to TDR and CS zone development standards to expand floor area bonus/TDR benefits to Category 2 historic inventory buildings in the CS zone, as requested for 51 Encina Avenue.
- GOVERNANCECity Manager Comments: Fire storm preparedness, Fire Department staffing, Fire Foundation, CDBG funding, Veterans Day event, and upcoming agendas. The City Manager provided updates on fire storm preparedness outreach, Fire Department staffing and facilities, a new Palo Alto Fire Foundation, the opening of the CDBG funding cycle, an upcoming Veterans Day program, and key upcoming Council agenda items.
- GOVERNANCEPublic Comment (Non-Agenda): Redlining history and request for apology regarding statements by an elected official. A resident objected to statements attributed to a council member that the resident’s claims about redlining were disingenuous, described their family’s experience with housing discrimination, and requested an apology for attempts to discredit them.
- GOVERNANCEEconomic Development Activity Report (November 2026). Staff presented the November 2026 Economic Development Activity Report, covering business engagement events, a small business training workshop series, business openings and closures, and retail/office vacancy metrics for California Avenue and Downtown/University Avenue. Committee discussion focused on vacancy rates, permitting timelines, and office market trends.
- GOVERNANCECommissioner Reports: Time-of-Use Pilot Feedback and Solar/NEM Concern. A commissioner reported on participation in a time-of-use pilot, stating they saved money by shifting usage despite an initial estimate they would spend more. The commissioner also raised a concern about solar customers and net energy metering not receiving full value and suggested bringing the issue back for discussion.
- GOVERNANCEPublic Comment (Non-Agenda): Criticism of council members, AI calls, and ceasefire advocacy. A speaker congratulated a campaign effort, alleged receiving AI calls, criticized specific council members with personal accusations, and reiterated calls for a ceasefire and to stop the war in Gaza.
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