Even before the COVID-19 pandemic dramatically shifted local commute patterns, Palo Alto’s parking policies were in flux as the city launched new residential parking programs, adopted new data-collection technologies and advanced a plan to build a large new garage near California Avenue.

Now, with business slowly coming back and some employees returning to the office, Palo Alto is eying another major shake-up with significant ramifications for workers in downtown and around California Avenue. Under the new plan, which the City Council Finance Committee endorsed on Tuesday night, permit prices for lots and garages will go up, and employees in the California Avenue area will no longer be able to purchase parking permits in the residential neighborhoods of Evergreen Park and Mayfield.

Instead, employees in the California Avenue business district will now be eligible to buy permits in the new 626-space garage at 350 Sherman Ave., a facility that staff is confident can more than accommodate the influx of cars that would shift there from residential streets. Concurrently, the city plans to lower the number of employee permits that it will be selling in the downtown Residential Preferential Parking (RPP) district. When the city launched the downtown RPP in 2016, it capped the number of employee parking permits at 2,000. It subsequently lowered the number to 1,000. Now, staff plans to cap the number at 580.

Even as it aims to steer more employees away from residential streets and into parking facilities, the city also is preparing to raise prices for parking permits for lots and garages in the California Avenue area and downtown, a move that Office of Transportation officials say will bring the city into closer alignment with nearby jurisdictions. In the downtown area, the annual cost of parking will increase from $806 to $900, while in the California Avenue area it will go from $403 to $650. The city also plans to offer some permits at lower rates for employees with qualifying income. These permits will be sold for $225 in downtown and for $162.50 in the California Avenue area.

Parking on residential blocks also will become more expensive for employees. The new plan calls for raising rates. In the downtown RPP district, permits will go up from $806 to $1,050 for most employees. Low-income employees will be eligible for $262.50 permits, up from the current level of $100. In the Evergreen Park/Mayfield and Southgate parking districts, permit costs for most employees will be raised from $403 to $750, while those with qualifying incomes will see their rates go from $50 to $187.50. For residents in each RPP district, the cost of the annual permit will remain $50, though households will no longer be eligible to receive one free permit.

In making the case for the changes, Chief Transportation Official Philip Kamhi underscored the fact that for most people, parking in Palo Alto garages remains a fairly cheap proposition when compared to commuting by transit. The monthly costs of parking in Palo Alto currently range from $33 to $67, according to staff. By contrast, in Mountain View, drivers pay $61 and in Redwood City, they pay between $40 and $100. The new pricing structure for garages and lots would bring Palo Alto into the $54 to $84 range.

"Parking in Palo Alto generally is severely underpriced compared to our peers and compared to, quite frankly, transit," Kamhi said. "If transit is significantly more expensive than parking, which it currently is, people will opt to drive."

In approving the latest suite of changes, city staff and Finance Committee members acknowledged that more changes will inevitably follow. Kamhi noted that the city's recent adoption of new parking technology – including a license plate reader and guidance systems in garages that track occupancy levels – will allow his office to track parking rates and adjust policies as necessary. The city’s existing demand models, he said, "are correct in a world that we don’t live in currently."

A report from the Office of Transportation notes that eliminating sales of employee parking throughout most of the Evergreen Park/Mayfield RPP district is "in line with expectations of residential stakeholders." Staff also believes the new garage at 350 Sherman provides a sufficient number of spaces to accommodate the roughly 250 cars that currently rely on permits to park in the Evergreen/Mayfield district (the Weekly’s parent company, Embarcadero Media, is located in the California Avenue district and some employees purchase passes for the RPP district).

While parking is poised to get more expensive, staff believe it also will become more convenient. Next year, the city will be making the switch from hangtags and decals to virtual permits, which will be available to residents and employees by online purchase. Nathan Baird, the city’s parking manager, said that once this change is made, the city will be able offer monthly permits rather than require employees to commit to six-month permits.

Council member Alison Cormack, who chairs the Finance Committee, supported the various changes proposed by staff but suggested that the city will likely need to make further modifications once it gets a better idea of what the parking landscape looks like post-pandemic.

"Perhaps we’ll have to change those prices and those numbers more than we had before, because we’re not in a stable situation," Cormack said.

Both of her committee colleagues, Vice Mayor Pat Burt and council member Eric Filseth, agreed. Burt warned, however, that by essentially driving commuters entirely out of the Evergreen Park RPP, the city may be setting an expectation for residents that this is the new permanent status quo. Some residents have urged the city for years to stop selling residential permits to employees and to adopt a residents-only program modeled after the one in place in College Terrace.

City officials are confident that the new California Avenue garage creates an opportunity to do just that. Under the new proposal, the only employees who will remain eligible for permits in the Evergreen Park and Mayfield neighborhoods are those who work on El Camino Real (they will be restricted to the parking zone close to their workplaces).

The new price structure also seeks to steer drivers toward garages. RPP permits currently cost as much as permits to park in city lots and garages — $806 in downtown and $403 in the California Avenue area. With the newly approved changes, it would cost more to buy a permit to park in the RPP districts than to park in public lots and garages.

Carol Scott, who lives in Evergreen Park, told the committee that she welcomes the change, which she says is consistent with the city’s Comprehensive Plan policy of promoting business but "not at the expense of residential quality of life." She lauded staff for working with residents to make the changes to the parking program.

But Burt suggested that the elimination of all but 40 employee permits in residential districts near California Avenue may not be a permanent move.

"I think it's entirely reasonable that these neighborhoods get what we committed to — that we ratchet down the number of permits in the neighborhoods. This basically goes to eliminating it," Burt said. "I don't want to set an expectation that we're going to struggle with."