When parklets began popping up on Palo Alto's downtown strips in the bleak days of 2020, they were embraced by residents, restaurants and city leaders alike as a key tool for helping businesses stay afloat and giving residents places to go during the pandemic.

Their function as outdoor dining hubs remains as popular as ever. Their form, however, increasingly leaves much to be desired.

With few rules to guide their development, the city's roughly three dozen parklets make up a ragtag and eclectic network of dining spaces with a wide variety of sizes, colors, designs and barriers.

In discussing the city's parklet scene on Sept. 11, City Council member Greg Tanaka likened it to a "temporary carnival" and suggested that the aesthetic chaos puts Palo Alto's downtown districts at a distinct disadvantage when compared to commercial strips in surrounding cities.

"Right now, you go there, whether it's Cal Avenue or University Avenue, and you see all these temporary barriers, a mishmash of stuff. … It's all over the place," Tanaka said.

"When we're trying to attract people and people have options of going to places much more hip, much more vibrant, much more put together, we lose," he said.

The city's process for bringing order to the chaos is itself somewhat chaotic. On California Avenue, where merchants and restauranteurs are at odds over the street's car-free status, the city is preparing to develop a long-term plan through an extensive process that is expected to unfold over the next year.

On University Avenue, which the city briefly closed to cars in the pandemic's early days before reversing course, the city is hoping to move a little faster. As proposed by staff, the car-free portion of Ramona Street just north of Hamilton Avenue would be bound by the same rules as University Avenue, even as it's functionally closer to California Avenue.

To instill some harmony, the council unanimously agreed on Sept. 11 to adopt a bunch of new parklet rules and to introduce fees for parklets on University and along portions of California that are outside the car-free section. These include limiting parklet sizes to 350 square feet; requiring that barriers next to parklets be anchored to concrete foundations; requiring enclosure railings to provide visual cues for drivers; and increasing the height of the enclosures around parklets from 38 to 42 inches.

Under the new rules, restaurants looking to install parklets would have to pay $2,000 application fees and $250 for annual renewals. In addition, they would have to provide a refundable deposit of $2,500 and an annual license fee for use of public right of way totaling $10.71 per square foot.

The council also agreed that at least one pandemic-era rule is now outdated: allowing gyms to create outdoor areas during the pandemic. Council members agreed Monday that having these spaces next to dining areas is no longer ideal.

Council member Ed Lauing made the case for excluding fitness businesses, citing his personal experiences of working out at a former gym on Emerson Avenue and having people see him from the street as he lifted weights near the window.

"I'm just not sure that's the kind of vibrant retail we're talking about. Having a little bit of decorum on the streets of our downtowns I think would be more to my liking," Lauing said.

Council member Julie Lythcott-Haims concurred and said that allowing fitness operations to operate outside is a relic of the pandemic.

"We created parklets because we had a communicable disease and people still wanted to work out and they still wanted to dine and shop retail," Lythcott-Haims said. "So we had to create possibilities for such things to happen. But now we're moving forward with an ordinance that's about life in general, so it feels like fitness is sort of like an anachronism from 2020."

Some business owners are calling on the city to ensure that the proliferation of parklets doesn't diminish the supply of public parking.

John Shenk, president of the real estate firm Thoits Brothers, which owns numerous downtown properties, urged the council Monday to explore construction of a new downtown parking garage. (The council in years past considered the idea, then aborted it, then resuscitated it more recently as part of a new program that invites developers to build housing and parking on public parking lots downtown.)

Speaking on behalf of a group of businesses that includes, among others, Onigilly, Reposado and The Patio, Shenk urged the city to account for the loss of parking spaces.

He also ask the city to modify parking standards to "not hurt those who do not have a parklet or those who prefer parking." This means ensuring that businesses only be allowed to build parklets that in front of their stores and not extend onto neighboring properties. Current rules allow them to infringe provided they get a letter of support from the adjacent tenant.

"Our downtown must be inviting and supportive to all retailers and not be dominated by a few food services," Shenk said. "Retail diversity is important."

Shenk and his coalition also requested that parklets comply with all building codes and ADA regulations and urged the council to create a "seamless, high-quality retail environment."

"Allowing a myriad materials, colors and designs will not support a quality retail environment for us," Shenk said.

Council members concurred with Shenk that the new parklets rules don't go far enough in establishing an orderly environment. Tanaka and council member Vicki Veenker urged city planners to work with the Architectural Review Board to create permanent design standards and uniform guidelines for the parklet program.

Tanaka called the effort urgent and asked that the item return within a year so that local businesses will have the confidence to invest in quality parklets.

"It really feels like we've fallen behind. … I'd like to see us move further beyond what we have right now," Tanaka said. "Part of the problem is that because the design is not quite finalized, it's hard for people to put dollars behind this."

While the council's final vote on parklets was unanimous, members debated the fees. Tanaka and Veenker initially proposed setting higher fees beyond what staff had recommended to achieve about 80% cost recovery (the fees proposed by staff would achieve about 50% cost recovery).

Council member Pat Burt took the opposite stance and successfully lobbied his colleagues to lower the annual renewal fee from $750, which staff had recommended, to $250.

Burt noted that the cost-recovery estimates fail to consider two major factors: the tax benefits that the city receives when restaurants generate additional business and the value that parklets bring in terms of revitalizing downtown spaces.

"The key to downtown recovery is creating vitality," Burt said. "There are retailers and others who look at this narrowly in terms of thinking that it's just about somehow the parking space in front of their retail business as opposed to how well the downtown does. That's what I'm focused on: the latter."