They arrived en masse, wielding signs, wearing buttons and clutching letters and petitions. Some brought their children; at least one brought a puppy. By the time the four members of Palo Alto City Council's Policy and Services Committee began their deliberation in front of the standing-room-only crowd, it was clear to everyone in the Council Chambers that this would not be your run-of-the-mill budget hearing. When it comes to animals in Palo Alto, emotions run high.

The group of protesters, which included more than 100 residents, animal advocates and shelter volunteers, flocked to the May 10 meeting to speak out against a proposal by City Manager James Keene's office to close the animal shelter on East Bayshore Road and outsource animal services to another agency -- a move that would save the city about $500,000 annually. About two dozen lined up to address the council, voicing a singular message: Closing the shelter would be a disaster for the city.

Many expressed shock that the possibility was even under consideration. Elena Kogan said she found it hard to fathom that one of the most affluent parts of the state -- a region that boasts some of the world's richest companies and nation's priciest real estate -- is struggling to keep a 5,400-square-foot animal shelter open.

"It's unbelievable that we're about to betray the most vulnerable life forms that are living among us, that are inherently dependent on us and that are a part of all of our lives in one way or another -- even if you're not a pet owner," Kogan said.

Scottie Zimmerman, one of the shelter's roughly 50 volunteers, recently gathered signatures on a petition to keep the shelter open. She told the council committee about the community's unspoken but unwavering support for animal services.

At the May Fete parade, she approached a young man standing near a truck on a shaded street. She asked him if he'd be interested in joining the group's effort by signing the petition.

"He handed me a fistful of money and took the thing and signed it. I found out later it was $100 in cash," Zimmerman said. "The next day I was collecting signatures and a nice woman wrote me a check for $100. I didn't ask for this."

Among the speakers was Carole Hyde, executive director of the Palo Alto Humane Society, who criticized outsourcing as a "radical departure" from the city's long-standing principle of "safe community."

Under this principle, stray animals are picked up "immediately before they're injured and killed and returned safely to their owners."

"Animals entrusted to the city rely for the lives and well-being on good and wise policies," Hyde said. "The Humane Society does not believe that trucking animals out of the area to crowded facilities and uncertain fates constitutes good and caring stewardship."

But Hyde was not just voicing an opinion; she came with a plan.

Since March 30, when Assistant City Manager Pam Antil shocked the animal community with the staff's recommendations, the Humane Society has been crafting its own proposal for raising revenues, cutting costs and preserving the local shelter.

The proposal calls for elimination of 4.2 full-time positions, including the shelter's supervisor, two animal-control officers and an animal-services specialist. The part-time volunteer coordinator position would be reduced by 25 percent, bringing the total savings from staff cuts to $430,000.

The proposal also includes raising revenues by $410,000 by increasing licensing fees, offering vaccinations on Saturdays and doubling the output from the spay/neuter clinic. The group also proposed establishing a task force to consider long-term solutions for animal services, a suggestion that council members quickly accepted.

Hyde's plan -- and the animal lovers' uprising -- produced instant results. Committee chairwoman Karen Holman, whose pets include a surrendered dog and the offspring of a lost pregnant cat, called the community's feedback "civic engagement at its very best." She called the city's commitment to animal services "a value that this community has held for over 100 years" and described the proposal from Hyde as "very professional and very impressive." Councilman Sid Espinosa was even more glowing in his review.

"We have contentious issues, and we take up debate every week," Espinosa said. "But rarely have I seen ... an organization come forward with a comprehensive set of ideas like that."

At the meeting's conclusion, the committee unanimously agreed that animal operations should not be outsourced and directed staff to come up with other ideas for raising revenues and cutting costs. Five days later, the council's Finance Committee came to a similar decision. For the first time since the Great Recession, a staff proposal for outsourcing a major city operation was rejected and the public sentiment had prevailed -- at least for now.

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Palo Alto's tradition of grassroots animal advocacy is almost as old as the city itself and includes some of the city's most storied figures. The Palo Alto Society for the Prevention of Cruelty to Animals (SPCA), the forerunner to the local chapter of Humane Society, was born in the earliest days of the 20th century and included as its founding members David Starr Jordan, the first president of Stanford University, and Jane Stanford herself. According to amateur historian Matt Bowling's new book, "Palo Alto Remembered," the two Stanford leaders helped push for the city's first horse watering trough in the days before automobiles.

Animals returned to the spotlight in mid-1920s, when Police Chief C.F. Noble ordered a crackdown on unlicensed stray dogs. According to Bowling, Noble hired a man named "Dick the Dogcatcher" to enforce this mandate.

"Soon the papers were full of letters from readers complaining about maimed dogs that were swiped from their home yards and porches," Bowling wrote. "There was also a history of the police operating with a 'shoot on sight' policy for strays."

Then, as now, the Palo Alto Humane Society (which was born in 1908) stepped up to the plate. The organization rallied to the cause of strays and helped establish a small shelter in the yard of Middlefield Road resident Mrs. Frank Thomas. This was the city's primary animal center until 1937, when its first official shelter was built on El Camino Real -- a site currently occupied by the Sheraton Hotel. Bowling described the 1937 shelter as a "first-rate" facility, with full kitchen service, one-way receiving kennels and well-known figures such as Tigger, a cat who helped clear out gophers from the parking lot, and Ol' Pa, "a desert turtle who promenaded along the kennel fence torturing the yelping poppies below."

Other animals, including monkeys, raccoons, porcupines, ducks, turtles and skunks, also made their way to the shelter, Bowling writes, "not to mention a rare visit from a wolf or a crocodile."

At times, the Humane Society had to flex its political muscles to protect this happy menagerie. In 1961, the society panned a proposal from the Stanford University School of Medicine to use the shelter's unclaimed animals for laboratory research. The Society's then-Director Gerald Dalmadge claimed that taking animals for research violated the principles under which the shelter was established. Hyde said Stanford withdrew the proposal because of "strong public reaction" against it.

The current shelter on East Bayshore opened in 1972 under the auspices of the city and as part of the larger Municipal Services Center -- a sprawling complex that houses the bulk of the Palo Alto's vehicle fleet and major portions of the city's Utilities and Public Works departments.

Despite the shelter's modest size and aging kennels, it's a clean and cheerful place bustling with volunteers, veterinarians and a diverse array of pets, from a cancer-stricken Pomeranian to a recently surrendered rat. Dogs and cats in containers of various sizes share lobby space with shelter employees as the latter schedule appointments and give callers updates about their pets' conditions.

The shelter is a popular place. According to the most recent Service Efforts and Accomplishments report issued by the City Auditor's Office, 68 percent of Palo Alto's respondents rated the city's animal services as "good or excellent," placing Palo Alto in the 90th percentile when compared to other cities and municipalities that were surveyed. In fiscal year 2011, Animal Services responded to 88 percent of animal calls within 45 minutes (the Silicon Valley Animal Control Authority based in Santa Clara responds within 10 hours, Antil said at a recent meeting, while the City of San Jose's animal-control operation responds "within a day.")

Perhaps most impressively, Palo Alto has successfully returned 68 percent of dogs and 20 percent of cats that were received by the shelter to their owners in 2011, surpassing its targets of 65 percent and 8 percent, respectively. Furthermore, 95 percent of the dogs and cats that were put up for adoption in 2011 were successfully placed in new homes, according to a recent report from Police Chief Dennis Burns.

And it's not just Palo Altans who frequent the local shelter. Burns' report notes that 76 percent of the animals who were spayed or neutered and 61 percent of those vaccinated in 2011 came from outside of Palo Alto and its three partner cities, Mountain View, Los Altos and Los Altos Hills. It's not uncommon for animal owners from as far away as Danville and Milpitas to visit the shelter, staff said.

Burns' report also identifies a number of options for keeping a local shelter but cutting staffing levels and drastically reducing services. One option, which would save the city close to $200,000 annually, would include (among other changes) the elimination of an animal-control officer and scrapping the shelter's in-house veterinarian and veterinary technician. But, as the report makes clear, even contracting out veterinary services but keeping the shelter would have significant repercussions for animals, particularly ones with non-life-threatening problems.

"Currently, the City Veterinarian handles medical issues that are not chronic in nature and with a positive outcome could make an animal adoptable," Burns wrote. "Some examples of these life-saving procedures are: amputation, eye enucleation, splinting, hernia repair, cryptorchid surgeries and cherry eye. Treatments such as those listed are done in the regular course of work by the veterinary staff, and adoption or rescue is the likely outcome. If these procedures were to be contracted out to regular veterinary practices the costs associated with these services may make them unobtainable and the animal would be euthanized."

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Palo Alto's current animal quandary grew out of a convergence of three mostly unrelated causes: the city's spiking employee expenditures, its decaying infrastructure and the recent departure of Mountain View from the long-standing partnership in the shelter.

Palo Alto may be home to some of the nation's richest residents and hottest companies, but city finances are a whole other matter. The General Fund, which pays for most basic city services (not including utilities), relies heavily on sales-tax revenues, which plummeted during the 2008 economic slump (this year, they finally roared back to their pre-Great Recession levels). At the same time, pension and health care costs for employees have soared in recent years, prompting an annual scramble by Keene and the council to balance the city budget without significantly reducing the city's scope of services.

Though the council has passed a series of cost-cutting reforms -- including a 10 percent staff reduction and cuts to employee benefits -- the impacts on the larger community have been minimal.

In this climate of budget cuts, outsourcing has emerged as an increasingly attractive option. These include the print shop, upkeep of the Palo Alto Municipal Golf Course, janitorial services and maintenance of local parks.

The effort generally has proceeded smoothly, with few protests or major mistakes (the only notable snafu occurred in September 2010, when the city's contractor over-pruned the trees on California Avenue, prompting an apology from the city). Palo Alto residents may be a vocal bunch, but few seem to care where their budget documents get printed or who prunes the trees at Rinconada Park, as long as they are pruned well. Given that outsourcing has become a reliable tool in the city's cost-reduction kit, perhaps it should have come as no surprise that staff proposed the same fate for animal services.

The council's newfound focus on repairing infrastructure has also thrust the animal shelter into the foreground. Last year, a 17-member commission issued a detailed report surveying the city's infrastructure problems and recommending ways to pay for the repairs and new construction. In its section on the Municipal Services Center and the Animal Services Center, the Infrastructure Blue Ribbon Commission wrote that the "aging facilities have been in need of upgrade or replacement for many years." It also recommended the city re-examine its strategy for providing animal services and consider "a closer relationship with regional providers such as the Silicon Valley Animal Control Authority."

But the most critical driver of the ongoing dilemma is Mountain View's decision last year to ditch its nearly 20-year-long partnership in the Palo Alto shelter and to switch over to Silicon Valley Animal Control Authority, which boasts a brand new 15,500-square-foot facility with cage-free kennels. Mountain View's departure means Palo Alto will no longer be getting the $470,000 in annual contributions from Mountain View. It also means that the cost to Palo Alto of keeping the animal shelter running with existing services is slated to go up from $1 million to about $1.5 million annually.

Given the city's structural budget deficits and cuts in other departments, the cost of keeping the shelter open is big, Keene told the committee.

"I don't think, in any of these situations, we're just looking at a $300,000 or a $500,000 operational gap," Keene said at the May 10 meeting of the Policy and Services Committee. "We're saying that over the next 10 years, the $300,000 or $500,000 in savings is $3 million or $5 million and that matters a lot as far as what it means for other services that the city provides."

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At the May 10 committee meeting, Councilman Espinosa concluded his comments by beseeching speakers to stay involved in the issue and to help the city find a way to make animal services financially sustainable. Two weeks later, a group of about a dozen die-hard animal advocates, including Hyde, Zimmerman and Luke Stangel, met at Palo Alto CafÈ on Middlefield Road to put Espinosa's plea into action. It was the inaugural meeting of Friends of Palo Alto Animal Shelter, a group that is now in the process of becoming an official nonprofit organization.

Palo Alto has no shortage of Friends groups. There's Friends of the Palo Alto Library, which holds monthly book sales to raise money for libraries, and Friends of the Palo Alto Parks, which does the same for local playgrounds and open spaces. Friends of Lytton Plaza, a collection of developers and business people, helped remodel the prominent downtown plaza in 2009, while Friends of the Children's Theatre raises funds to keep the acclaimed theater operation running at an affordable rate for participants.

In most cases, these groups come together to promote new services or to protect existing ones from the budget axe. The fact that man's best friend hasn't had a Friends group to reciprocate the friendship says less about the public attitude toward animals than it does about the city's legacy of offering to the community a vast array of state-of-the-art animal services. There simply hasn't been a need, until now, for a Friends group to protect animal services from budget cuts.

At its first meeting, the group sat around a long table and brainstormed ways to raise money and awareness. Stangel, an active member of the nascent "Save Our Shelter" organization, led the discussion, which ranged from potential fundraising events to the group's name. Maureen Allen, one of the participants, lobbied for "animal services" over "animal shelter" in the title. Stangel advocated for keeping "shelter," even though -- technically speaking -- it is the services inside the shelter rather than the building itself that are now under fire. When most people think about the local animal programs, it's the shelter that comes to mind, Stangel said. The debate concluded with no resolution.

The discussion then turned to fundraising, and there was no shortage of ideas -- from donation cans at local classrooms and agility challenges at city fairs to dog-friendly concerts in the park and designated dinner days at participating restaurants, with a portion of proceeds going to Animal Services. Then there's the work of maintaining the organization's day-to-day operations. Stangel and two other members are now in the midst of creating a website for the new Friends group to solicit donations and inform the community about progress and upcoming events.

Stangel, a former newspaper reporter who now lives in San Jose and works for a startup company, said he was shocked when he first heard that the city is considering outsourcing animal services.

"It's kind of like if they had announced that they're considering outsourcing libraries or outsourcing the Fire Department," said Stangel, owner of two cats and a dog. "To me, personally, it seems like it's one of those critical city services that absolutely should not be outsourced."

Stangel was one of the first to join a fledgling "Save Our Shelter" Facebook group that Zimmerman launched shortly after the proposal to outsource animal services was made. He then created a petition imploring the city to keep the shelter running. The message spread quickly and as of last week there were more than 2,000 signatures and counting, he said.

"It's incredible. I was going out and talking to people and nine times out of 10 they were completely up on this issue," Stangel said. "Everyone knew about it, and they were very concerned about the issue."

Now, his group hopes to channel this energy into its fundraising efforts. All the donations that have been collected thus far will be kept by the Humane Society while the new Friends group completes the process of filing for nonprofit incorporation. The goal, he said, is to raise at least $100,000 in its first year and to set higher benchmarks in future years.

The group has already scheduled its first fundraising dinner, which is set for June 19 at Gordon Biersch in downtown Palo Alto. Further down the line, it is eyeing events such as a 5K race in the Baylands and a gala dinner.

"The energy behind this effort is so high," Stangel said. "We're having people coming out and just asking how they can send money."

The group has already succeeded in changing the conversation at the council level, with both council committees agreeing that the shelter should not be shuttered. Now, Stangel hopes the group can raise enough money to compensate for Mountain View's departure and, in doing so, convince the council to keep the budget cuts for Animal Services to a minimum. The goal, he said, is to keep the city from adopting a "permanent solution" -- sweeping service reductions -- for the "temporary problem" brought about by Mountain View's withdrawal.

"Is it reasonable for us to ask the council to please run (animal services) at a greater deficit because we'll pick up the slack?" Stangel said at the conclusion of the Friends group's first meeting. "Our group will help raise the money."