With tensions running high in Palo Alto over new developments and traffic issues clogging up City Hall agendas, Jay Paul Company had an unenviable task on Wednesday night -- convincing dozens of skeptical residents that its plan to build two large office buildings in one of the most congested parts of the city is the right move.

Judging by the feedback, the company still has plenty of selling to do.

Jay Paul's proposed for 395 Page Mill Road is the largest "planned community" (PC) application in the city's free-flowing development pipeline. The zoning designation allows builders to exceed regulations in exchange for a negotiated set of public benefits. In this case, both the zoning concessions and the benefit on the table tower over those of a typical PC project. Jay Paul is requesting permission to build 311,000 square feet of office space at a site, bounded by Park Boulevard, Ash Street and Olive Avenue, already developed to the legal limit. In exchange, it would build for the city a critical amenity that has been eluding officials for decades -- a new police station.

"We recognize that we're asking for a lot in terms of density from the city. I think we're offering a lot, both in terms of intelligent development for the city going forward and also in terms of the public safety buildings," Ray Paul, executive vice president at Jay Paul Company, told a crowd of more than 40 residents.

The Wednesday night meeting, organized by Jay Paul, came at a time when the city's zoning policies are facing heavy scrutiny and the council is struggling to come to grips with the growing problems of traffic congestion and parking shortages in residential neighborhoods. It took place two weeks after Palo Alto voters overwhelmingly rejected on Election Day a much more modest PC-zone proposal on Maybell Avenue and just two days after Mayor Greg Scharff declared that he will delay review of major PC applications, including Jay Paul's, in order to engage the community and the council is a discussion about zoning issues and new development.

In a particularly awkward twist, the Jay Paul meeting took place on the same night that the Planning and Transportation Commission was discussing a "concept plan" for the area around California Avenue and Fry's Electronic, which includes 395 Page Mill. The timing forced area residents to choose between going to City Hall to discuss the city's long-term vision for the area or attending the Jay Paul meeting at the AOL Headquarters to hear about the new development.

Most chose the latter, prompting the planning commission to schedule another meeting on the concept plan for Dec. 11 so that more people would attend and offer feedback about their neighborhood's long-term future.

"It's our intention to engage fully with the community and get a full opportunity for everyone to express their views and answer any relevant questions," planning commission Chair Mark Michael said at the onset of the concept-plan discussion.

Ray Paul faced a similar task, though unlike the commission he received more than enough input. Residents voiced concerns about traffic congestion, parking shortages and pedestrian safety. Paul freely acknowledged that the project would increase traffic (slowing down the peak-hour drive by between 1 and 2 mph on Oregon Expressway heading toward U.S. Highway 101 and by slightly more than 2 mph going east toward Interstate 280). But he also said the building's proximity to the California Avenue Caltrain station makes it an ideal site to add office space while minimizing traffic impact.

Paul acknowledged that planned-community zoning is a "hot-button" issue in Palo Alto these days, given the voter's defeat of the Maybell housing development. In the Jay Paul case, he said, the zoning makes sense.

"We certainly don't think and are not promoting the concept that this city or any other city do all of its development through PC or very much of it, but we do think there's a place for it for virtually any city's building," Paul told the audience. "We'd like to make the case for why here."

Though the project would stand near the heavily congested intersection of Page Mill and El Camino Real, Paul argued that the company's strategies for encouraging alternative commuting would lead many of the buildings' employees to take public transit and other modes. The company plans to offer a bus service, he said, as well as subsidized Caltrain passes. It also plans to create better walkways for pedestrians between the new buildings and the transit station.

"We're close to the train, we're close to the bus routes and we think we can put together a traffic-demand-management program that could have a significant impact on the amount of traffic we would cause," he said.

Paul told the audience that the company has plenty at stake in getting the traffic right.

"It does us no good to produce an office project where the tenants can't get into the office in the morning and can't get out in the afternoon," he said. "We need a project that makes sense from a traffic point of view. Otherwise we can't lease it.

"I heard a lot of statements about how a developer just wants to make a quick buck and leave town and so on and so forth," he added. "It just doesn't work this way."

Though the proposal has yet to undergo a formal City Council review (it's been a subject of a council study session), it has already had a rocky journey. Just in April, the council's Infrastructure Committee agreed to expedite the review process to make the timing consistent with a potential November 2014 infrastructure bond measure, which may include funding for a police building. But now, with PC zoning under fire, it is out of the fast lane. Scharff said Monday that the council will not review it in early December, as previously scheduled. Meanwhile, the city's traffic consultants are putting together an analysis for the development, a document that the council had hoped would be completed in the fall but that has been delayed until December because of staff's concerns over methodology.

Paul maintained that the analysis will show that the project's impact, while real, will be far smaller than many fear. The developer, whose large commercial projects include the existing AOL building at 395 Page Mill and many others throughout Silicon Valley, has plenty of experience with high-tech tenants and their parking demand, he said. Even if the donated police building wasn't in the equation, he said, the proposed development would "stand on its own merits" when it comes to parking and traffic.

"We don't want to be pushing our parking into a residential area," Paul said. "We don't believe we have to."

The Jay Paul project consists of two four-story buildings along Olive and Ash streets, each 57-feet high (with another 15 feet of mechanical equipment) and two floors of underground parking. The police headquarters would stand across the street, at 3045 Park Boulevard, and would feature underground parking for police vehicles.

The design of the buildings is still evolving as the project proceeds through a series of Architectural Review Board meetings. Tom Gilman of the firm DES Architects showed the latest version on Wednesday. The revised design features details such as smaller windows, slimmer lines, punched openings and roof overhangs.

"The idea is of introducing smaller-scale elements that start to have compatibility with the smaller scale of the residential neighborhoods," Gilman said.

Not everyone bought these arguments. Bob Moss, a land-use watchdog who was one of the leaders of the successful Measure D referendum, called the project "grossly underparked." He also cited the project's conflict with the California Avenue area plan, which subdivides the area around California Avenue into three subsections. Moss noted that when the city put the plan together, it looked at existing zoning designations and then considered possible changes. The Jay Paul development, by being developed as a "planned community," would dominate the area, he said.

"This project of course is not current zoning and it would consume all the potential development in the California Avenue and then some," Moss said.

Joe Hirsch, who also led the referendum campaign, marveled at the fact that the new buildings would go up in a zone already developed to the maximum.

"I can't believe this massive building will make things better," Hirsch said.

Neilson Buchanan, a Downtown North resident who has been gathering data about the city's parking shortages, was one of several residents who stressed the need for a traffic analysis that accounts for the cumulative impacts of the many projects being planned, including the mixed-use building at 3159 El Camino that the council approved this week and the proposed four-story building at 2755 El Camino Real, at the corner of Page Mill, which like the Jay Paul project is requesting a planned-community zone.

"What's frustrating us citizens is that we can't get our city to (consider) the cumulative impact of all the projects," Buchanan said.