Proposed City of Palo Alto Statement of Willingness to Enter into PRT4SRP Franchise Agreement

PRT4SRP: Personal Rapid Transit for Stanford Research Park, (Preliminary Draft by Cities21, 4/9/04)

1. Project benefits

less traffic less greenhouse gas more housing more vibrant city more auto-free mobility improved public transit fare recovery increased ability to attract employees increased office and residential land values increased retail sales no taxpayer cost.

1.B. Document Objectives Create a "no risk" document that the City of Palo Alto can adopt. Create a primarily private sector proposal for PRT4SRP, where the public sector would concentrate on eliminating barriers (and receiving benefits) while assuming zero financial risk. The spread of the electric trolley began in 1888 and was created by cities granting franchise agreements whereby private sector firms built trolley systems for speculative real-estate gains. Anticipate and address many of the popular objections to PRT. Attract publicity to PRT to accelerate private sector funding. 2. Project Summary City of Palo Alto is willing to entertain Franchise Agreement proposals from personal rapid transit (PRT) developers wishing to construct a PRT system within Stanford Research Park (SRP) and adjacent areas, connecting to Caltrain's California Avenue station, VTA/SamTrans bus service, and adjacent retail establishments. It is envisioned that such a franchise would be part of long-term planning and transportation strategy for Palo Alto, and would not be operational until Year ‘07 It is envisioned that new housing will be constructed within SRP on reclaimed parking lots. Such housing will be prioritized for SRP employees (as well as city employees), providing compelling motivation for SRP employers to back the PRT proposal. It is envisioned that the State of California will continue to request aggressive new housing production targets within Palo Alto's Housing Element. To that end, construction of housing within SRP will reduce pressure to add in-fill housing within Palo Alto's single-family residential neighborhoods. The City will assist the formation of appropriate egress and right-of-way agreements. The City will modify General Plan and Zoning Regulations to accommodate PRT4SRP.

The City will make appropriate use of currently budgeted staff time to attract potential franchisers. Once appropriate franchising candidates are selected, such candidates will be required to fund related City conducted work. It is envisioned that a PRT developer can structure a business arrangement whereby 1) a portion of PRT-enabled real-estate profits may be captured, and 2) "super-normal" profits may be obtained in exchange for the developer bearing the technology risk. In recognition of the many benefits to the City of Palo Alto listed in Section Number 1, the City will charge the PRT developer an annual franchise fee of one dollar. 3. Franchise Agreement Requirements 3A) Full Environmental Impact Analysis and Community-Centered Open Approval Process A thorough EIR/process will be followed, with some particular emphasis: PRT4SRP represents a very complex project. Efforts should be made to provide high-quality, independent advice to affected neighborhoods so that they may best evaluate and influence the proposal. PRT developer should provide funding for the hiring of an appropriate consultant, selected by the neighborhood associations and agreeable to the PRT developer. Efforts should be made to ensure that neighborhood associations play an active role at all stages of the process. Noise: Noting that College Terrace has been sensitive to noise impact in the past, extensive noise studies should be conducted, and the neighborhood associations should be provided with early access to preliminary results. In addition, new housing production within SRP must be situated in such a way that R&D employers who may have noisy, late night deliveries are not constrained by new residential neighbors. Visual impact of PRT is also of special concern for the PRT4SRP project. PRT requires placing shallow column footings (typically two to four feet deep) in the ground. Great care should be taken with the analysis to ensure that the placing of these footings will not cause toxic contaminants to enter the groundwater table (typically at 10 or more feet deep) below. Planning for fire, natural disasters, and other safety scenarios is very important. Station security measures must also be rigorous. Early and frequent meetings between the PRT developer and fire department will be required. 3B) Political Considerations: Important constituents will have to strongly embrace the proposal in order to assist in bringing about the "cultural change" to reduce solo commuting. These should include: Substantial voting majority of adjacent neighborhood citizens including College Terrace, Barron Park, and Junipero Serra, as well as citizens residing near California Avenue retail shops. Major employers within Stanford Research Park must form a Transportation Management Association (TMA) to create a single, cohesive unit to address both the proposal and other transportation/commuting issues. Once the TMA is formed, a vote in favor of PRT4SRP, respecting TMA bylaws, is required. In addition, the TMA must provide for: a) a state-of-the art car sharing program serving all SRP employees, b) an efficient "guaranteed ride home" program for all SRP employees, c) phone-based customer support for SRP employee commutes, d) substantial marketing and executive commitments to encourage commute alternatives.

Long-term ground lease holders who sub-lease to major employers must back the proposal. Substantial voting majority of California Avenue Retailers Association. Substantial voting majority of all Palo Alto citizens Stanford University, the primary landowner of Stanford Research Park, effectively has "veto" power. Moreover, the proposal should not proceed without an enthusiastic statement of support by Stanford. Transit unions: As envisioned, the PRT system will increase unionized transit employment by increasing ridership on public transit. It is envisioned that bus routes such as the Dumbarton Express will be modified in such a way as to provide more frequent service to originating passengers while reducing driver fatigue by eliminating multiple stops within the research park. Assuming that housing is built within SRP, some affordable housing units should be built and prioritized for local public transit employees. 3C) Insurance: Tear down insurance - PRT developer must dedicate insurance funds before construction start sufficient to be used to remove the system upon failure to meet various Council-mandated performance measures. Conditions will include reliability measures and ridership measures. PRT developer will purchase sufficient insurance to insure against losses due to natural disasters, man-made disasters, and system failures. 3D) Real-estate: No additional development outside of that which is already part of the Palo Alto General Plan and amendments will be allowed without proof of reduced traffic. Real-time monitoring of the number of parked vehicles within the research park must be provided by the PRT developer (and allowed by the TMA). Upon proof of parked car reductions, appropriate development will be allowed based upon a formula set by the City of Palo Alto. The impacts of such new development will also be monitored as part of the formula. Toxic Releases: SRP contains two superfund sites and 21 toxic groundwater sites. A few companies within the research park still use hazardous chemicals in industrial processes. Although very stringent safety procedures are followed, there is still a very tiny chance that a toxic release into the air will occur. Children are even more sensitive than adults to toxic chemicals. Stanford Management Company is planning on putting 250 new residential units within SRP, near the Western tip of California Avenue. These residential units will be located a safe distance away from potential toxic releases. All new housing proposals within SRP should carefully consider the "risk contour" (an oval shape showing the extent a one hour release would have, given prevailing wind patterns) of potential airborne toxics. Extra care should be taken to protect new residents from such releases. A proposal by Alza Corporation to modify their SRP hazardous materials facility in the 1980's resulted in a very extensive debate of this issue. If the citing of new housing within the research park increases the "hazmats" reporting requirements of some employers, those employers should be provided with some form of "compensation" so that they are made no worse off. This compensation might be in the form of

housing preferences for their employees, or, the improved transportation options for their employees might provide sufficient benefit. A formal letter of support must be received from two expert committees for each new SRP in-fill housing proposal to move forward. These two committees are SVMG's Environmental Committee and Palo Alto Chamber of Commerce's Environmental Health and Safety Forum. The SVMG Environmental Committee's January 2004 policy statement on "Non-Industrial Uses in or Near Industrial Zones" explains the necessary balancing act between a) protecting manufacturing, R&D, and industrial operations for the future economic viability of Silicon Valley and b) rezoning underutilized areas. No additional development outside of that which is already part of the Palo Alto General Plan and amendments will be allowed without careful consideration as to how renowned K-12 public education quality will be preserved both for new and existing residents. The high cost of housing has resulted in teachers leaving the school district. Assuming that housing is built within SRP, some affordable housing units should be built and prioritized for teachers, to increase teacher retention. A committee of SRP facilities managers shall be formed. Substantial efforts shall be made to create a PRT system that provides maximum benefit to facilities managers, such as accommodation of high bandwidth communications cable within the PRT guideway. 3E) Senior Mobility: Senior citizen mobility is an important issue for Palo Alto, because the U.S. Census reveals that Palo Alto has a relatively older population compared to other Bay Area cities. Part of this can be explained by high housing prices keeping people in their existing homes while pricing out "twenty-somethings" from buying in Palo Alto. Unfortunately, our physical capabilities (eyesight, reaction time) degrade gradually as we age. Recently, there has been serious discussion of re-testing 70-year-olds with the possibility of revoking driving privileges. This testing proposal did not make much progress politically, as it was pointed out that distracted teenage drivers pose more of a threat than seniors. However, the issue of how seniors in their seventies, eighties, and nineties travel to their many activities will continue to grow as an issue. Trends predict longer life expectancies, a core desire for active lifestyles, and a growing senior population. As an aside, seniors are making principal engineering contributions at some PRT development companies. A committee shall be formed to consider how the PRT4SRP proposal may best address the needs of seniors. Auto-free mobility may contribute to a more active lifestyle. Recommendations should be given serious consideration for inclusion in the plan. 4. Electricity Usage PRT4SRP is expected to have a peak electrical "load" of 1.8MW or less, occurring during morning rush hour. Accommodating peak capacity is an important part of electric utility strategy because increases in maximum peak usage may require the construction of expensive, new power generation plants. It is anticipated that PRT4SRP peaking patterns will be complimentary with current summer weekday peak early afternoon power consumption patterns - no additional power plants will be required. Annual electricity usage will be 5,159 MWh or less. At roughly $0.12 per kWh (from Tariff E7 for large industrial users), annual cost will be $619,000. Due to the need to provide "high availability" power to the PRT system when power supply is low, an additional charge may be necessary.

"Third-rail" versions of PRT will connect many electric motors to the City's electrical system. The City will make appropriate use of currently budgeted staff time to conduct a short exploratory dialog with PRT developers to better define required electrical system modifications to ensure continued high quality electric utility service. 5. Franchise Agreements - Background Information Franchise agreements are complicated contracts between the public sector and a third party, granting the third party the right to provide a particular service. Up to two years ago, the City of Palo Alto maintained a franchise with Cable Co-op to provide cable television to residents. In Las Vegas, the city has granted a franchise to build and operate a large monorail transit system. In the late 1880's, cities granted franchise agreements to real-estate speculators who built electric trolley systems. "The first electronic trolley line opened in Richmond in 1888, was adopted by two dozen other major cities within a year, and by the early 1890’s was the dominant mode of intraurban transit. The rapidity of the diffusion of this innovation was enhanced by the immediate recognition of its ability to mitigate the urban transportation problems of the day." (Peter Muller) By 1905, the world's largest contiguous trolley system was the East Bay Key System, an amalgam of systems consolidated by soap-king Borax Smith. Comments on the franchise agreement concept General Manager of a major business park: "your approach makes a lot of sense." Leading local affordable housing advocate: "Looks good--an interesting approach" U.C. Berkeley City Planning Professor Fred Etzel (smart growth lawyer: "This is a very creative and visionary idea. In my mind, you have correctly identified the key political considerations." Leading local transportation official: "Very creative! Terrific!"