Palo Alto seeks ‘pro-housing’ designation after resisting growth

Palo Alto is seeking to earn a pro-housing designation from the state of California this year, a label that would mark a major shift in the way the city has responded to growing regional housing needs amid significant resident pushback to new development.

If the city’s application succeeds, Palo Alto would join 74 other cities — including neighbors Mountain View, Redwood City and Los Altos — in gaining access to millions of dollars in state grant funding for additional housing projects down the road. According to city staff, the state has doled out $56 million in grant funding since 2022 to pro-housing designated cities.

“Pursuing designation now is consistent with regional momentum and positions Palo Alto to compete more effectively for state housing funding alongside peer jurisdictions,” the staff report states.

Most grants are between $500,000 and $5 million, said Senior Project Manager Julia Knight, who prepared the application materials. Knight presented the application to the Planning and Transportation Commission on May 27 for feedback and review before the item goes to the full City Council for approval in mid-June.

The application requires cities to explain how they are exceeding state standards for encouraging housing production through local policies, which are divided into four broad categories: favorable zoning and land use, streamlined permitting, cost reduction and financial subsidies for affordable housing.

Cities then submit a draft self-scoring sheet based on these categories, with the option for “enhancement points” for policies that, for example, make additional effort to increase affordability. A score of 30 or higher is required to meet the pro-housing designation, and Palo Alto’s self-scoring totaled 41 points.

According to Knight, the state Housing and Community Development department has already provided preliminary review to Palo Alto’s application and had positive feedback.

“We think we’re very likely to get the designation, which is great,” Knight told the planning commission.

The process is noncompetitive, meaning that any city that applies and receives a sufficient score will qualify and unlock additional state grants for housing. Cities must reapply every three years to maintain the designation, Knight added.

Some of the policies that Palo Alto cites in its application include the adoption El Camino Real Focus Area, which relaxed height and density limits along a segment of El Camino Real, the implementation of Senate Bill 79, which promotes dense housing near transit areas, and the creation of the San Antonio Road Area Plan, a vision document that aims to create a new residential community in a historically commercial area in south Palo Alto.

The city has also advanced several projects for vulnerable populations, including Homekey Palo Alto, Mitchell Park Place and the safe parking program on Geng Road.