Palo Alto's contentious drive to make California Avenue more friendly to pedestrians and bicyclists zipped past heated opposition from dozens of area merchants Monday when the City Council nixed a trial elimination of two of the street's four lanes.

The council unanimously approved city staff's latest streetscape proposal, which includes wider sidewalks, new street art and a tree-lined plaza next to the Caltrain station. At the same time, it affirmed an earlier commitment to the reduce the number of lanes. The only disagreement on the council was over whether the city should stage a trial period of the lane reduction to ease merchants' concerns that the change would create congestion and threaten businesses.

The Planning and Transportation Commission earlier this month recommended that the city allow merchants to propose a trial project. Staff, however, had major reservations.

Some on the council reasoned Monday night that a trial is a reasonable price to pay for improving the city's relationship with California Avenue merchants, many of whom still have fresh in their minds the 2009 incident in which the city unexpectedly cut down all the trees on the avenue. Councilwoman Karen Holman and Councilman Greg Schmid said they were willing to support a trial. But the rest of the council declined after hearing staff's reservations.

Planning Director Curtis Williams said it would be impossible to implement the trial without making major changes to the street, and even if these changes were made, the project that would be in place wouldn't fairly represent the permanent streetscape plan. And if the city were to repave and restripe the street to make the trial possible, it would be difficult to come up with criteria for judging whether the trial is a success or not, Williams said.

"It's very difficult in a trial process to really replicate the safety and aesthetic benefits of the project," Williams said. "We feel like the trial itself would be a visually unattractive thing to do."

The lane-reduction plan is a central component of the streetscape project, which the council had initially approved in February 2011 but which has continued to evolve since then. Monday night's vote pertained to the latest changes, particularly wider sidewalks, flexible public-plaza space between Ash and Birch streets and a more intricate plaza at Park Boulevard, featuring public art, trees and benches.

The council has consistently and unanimously supported reducing lanes, with the hope of turning California Avenue into a more pedestrian- and bike-friendly thoroughfare, akin to University Avenue or Mountain View's Castro Street. The idea has met fierce resistance from area merchants, 55 of whom signed a petition voicing opposition to the lane reduction. The project has also been the subject of two lawsuits, one of which (filed by Terry Shuchat and Joy Ogawa) succeeded in delaying the release of grant funds for the project. The other suit, filed by Robert Davidson of California Paint Company, was thrown out.

Former Vice Mayor Jack Morton (whose accounting practice is a block away from California Avenue), Terry Shuchat of Keeble and Shuchat Photography and Dave Bennett, owner of Mollie Stone's Market all spoke out against the project Monday night, claiming that the lane reduction would hurt business. Bennett cited a number of challenges Mollie Stone's is facing, including the city's recent approval of new supermarkets at the redeveloped Alma and Edgewood plazas and the food trucks in the neighborhood. The project would reduce access to the supermarket, creating what Bennett called a "very challenging situation."

"We really feel our supermarket here is in jeopardy," Bennett said. "If this goes through, we really feel the possibility of losing the neighborhood supermarket."

City officials, however, maintained throughout the process that the lane reduction would have no impact on California Avenue traffic. Councilman Pat Burt noted that the four-lane California Avenue was built many decades ago when the street crossed the railroad tracks and served as a major artery across town. These days, the street hits a dead end at the Caltrain station.

Staff also pointed at traffic data that indicated relatively low ridership on California Avenue, when compared with major downtown streets. The data showed that average daytime traffic volume on California Avenue is three times lower than at other commercial boulevards in the immediate area. California Avenue has about 5,280 average daytime trips, while University Avenue has 18,700 trips and Castro Street in Mountain View has 20,000. Both of the latter streets have two lanes while California Avenue has four.

Some area residents supported this data with personal observations and urged the council to get the project going.

"California Avenue is supposed to be a pedestrian-centered place where people can come and enjoy the businesses and to really get out of the car," said Christopher Bush, an area resident.

He compared the merchants' opposition to a game of Whac-a-Mole -- as soon as one effort at opposition fails, they find another.

Michael Eager, who lives several blocks from California Avenue, also disputed the assertion from merchants that the street is congested. The project, he argued, has been delayed enough. The street, he said, is not attractive and the plaza currently in place is "downright ugly." A trial would make the area even more ugly, he said.

Councilman Larry Klein agreed that a trial is unnecessary and said he's not willing to pay for one just for "political expediency."

"I don't think that's how our citizens want us to spend the money," Klein said.

Other council members said they were concerned about the outpouring of criticism from area merchants. Councilman Sid Espinosa said the opposition from a large segment of the community has given him pause, though he disputed the assertion from critics that the city hasn't listened to their concerns. Staff, he said, has tried hard to respond to concerns from the business community.

"I really take issue with this constant chime of people saying they haven't been heard," Espinosa said.

Burt, who had served on the planning commission before joining the council, attributed the high level of opposition to "misinformation" put out by merchants.

"I really don't think I've ever encountered a project where there's been so much misrepresentation disseminated -- where people hear things that are claims and they tend to think there is some truth to it," Burt said.

The elements of the project that the council approved Monday added about $700,000 to the project's cost, raising the price tag to more than $2.1 million. The city expects to get a $1.2 million grant for the project from the Metropolitan Transportation Commission and spend $550,000 of its own money for the project. The balance of the funds would come from a vehicle-registration-fees program administrated by the Santa Clara Valley Transportation Authority. Without the council's commitment to reduce the number of lanes from four to two, the city would have lost the opportunity to apply for grant funding for the streetscape project, according to staff.