Palo Alto plans to challenge an appeals court ruling that ordered the city to refund more than $900,000 to a downtown developer after a dispute over parking fees.
The City Council voted 6-1 in a closed session on Monday, April 17, to appeal the March 20 ruling from the 6th Appellate District Court of Appeals that sided with developer Charles "Chop" Keenan and his company Hamilton and High LLC and against the city. The appeals court concluded that the city had illegally imposed in-lieu parking fees on the developer while he was seeking approval for his mixed-use building at 135 Hamilton Ave. in 2013.
Keenan's company paid $1.56 million in fees to the city as part of the approval project, including $972,000 in in-lieu parking fees.
Mayor Lydia Kou announced after the closed session that the city will appeal the ruling to the state Supreme Court. Council member Greg Tanaka was the sole dissenter.
The in-lieu parking fees are imposed on developments that fail to provide enough parking on-site to meet local zoning regulations. Funding is intended to support the city's efforts to meet parking demand by, for example, building new parking garages. But while the city is currently exploring ideas for building mixed-use structures with housing and parking on downtown lots, the council has effectively abandoned its prior plan to build a new garage on a city-owned lot at 375 Hamilton Ave., near Waverley Street.
The appeals court ruling also dinged the city for failing to meet its obligation to formally approve findings every five years that account for the money in the parking fund, regardless of whether the funding is actually spent. While the city had argued that these fees should not be bound by the requirements of the Mitigation Fee Act, which requires the five-year findings, the appeals court rejected that argument.
In ruling against the city last month, the appeals court had overturned a judgment by the Santa Clara County Superior Court in favor of the city.
Comments
Registered user
Another Palo Alto neighborhood
on Apr 19, 2023 at 5:18 pm
Registered user
on Apr 19, 2023 at 5:18 pm
This appeal will ultimately result in a failed effort by the City and a further waste of Palo Alto taxpayer funds.
While the City prevailed in the lawsuit filed by Keenan Land in Santa Clara County Superior Court, that judge"s decision was overturned on a unanimous vote by 3 judges on a California Appellate Court Panel. The Appellate Court judges based their decision on the plain meaning of language contained the Mitigation Fee Act (not some subtle inferred meaning argued by the City) and documented/supported their findings in a 47-page, published decision. The Appellate Court found that the in-lieu parking fees collected by the City from Kennan were subject to the Mitigation Fee Act and further found that the City did not adhere to the requirements of the Mitigation Fee Act when filing five-year findings. The Appellate Court ruled that a late filing of five-year findings did not cure the City's non-compliance with the Mitigation Fee Act.
The quality of the decision rendered by the 3 judges at the Appellate Court far exceeds the quality of the decision rendered by single judge at the Superior Court level (as decisions most often do - because Appellate Court judges are usually more proficient/adept/experienced at law than Superior Court judges).
It appears highly unlikely that the California Supreme Court will take this case on overturn the Appellate Court's decision.
The Mitigation Fee Act language is quite clear; If the required five-year findings are not timely filed, any unspent funds collected and held must be returned to the parties that contributed them in the first place.
The City of Palo Alto should just admit their failure to adhere to the requirements of the Mitigation Fee Act and return Keenan's money asap. City staff and City attorneys encouraging an appeal to a higher court are gambling with taxpayer funds on a low probability outcome.
Councilman Greg Tanaka is the only one showing sense on this.
Registered user
Downtown North
on Apr 20, 2023 at 4:41 am
Registered user
on Apr 20, 2023 at 4:41 am
Any word on why the city didn't meet its obligations on the Mitigation Fee Act?
Registered user
Embarcadero Oaks/Leland
on Apr 20, 2023 at 10:59 am
Registered user
on Apr 20, 2023 at 10:59 am
Speaking of the city wasting money appealing court-ordered settlement, any word on when we're going to get our money from the Miriam Green lawsuit against the city's long-time practice of overcharges us for utilities to feed the General Fund which pays for appeals like this one?
Kafka would be proud. See also "Catch 22"
Registered user
Green Acres
on Apr 23, 2023 at 4:26 am
Registered user
on Apr 23, 2023 at 4:26 am
JS1 is right on this. Why can't the City admit when it made a mistake? Like Online, I also immediately thought of the utility overcharging...