A bicyclist passes by Green Library at Stanford University on June 7, 2019. Photo by Sinead Chang.

As Santa Clara County prepares to approve new policies governing Stanford University’s growth, a key goal is to ensure that Stanford supplies enough housing on its campus to accommodate a growing workforce.

But as the county Board of Supervisors looks to adopt the new Stanford Community Plan next week, one question remains unanswered: To what extent should Stanford be allowed to lean on surrounding cities, most notably Palo Alto, for housing sites?

The question is a critical one, not just for Stanford and the county but also Palo Alto, which is striving to meet its state-mandated requirement to plan for new housing between 2023 and 2031 for an anticipated expanding population. In recent years, Stanford has gobbled up Palo Alto residential properties and then limited them to its own affiliates, as happened last year when Stanford purchased Oak Creek Apartments on Sand Hill Road.

Allowing more of that to continue would unfairly burden Palo Alto, city officials and residents argued to the county Planning Commission at its Sept. 28 meeting, when it discussed the Stanford Community Plan, the biggest update of the university’s growth policies since the current plan was adopted in 2000.

Resident Nancy Krop urged the commission to concentrate more new housing on Stanford’s campus and less in surrounding communities, which are already struggling to build enough residences for their own workforces.

“If they do not mitigate and put those homes in our community of Palo Alto, they are grossly magnifying our already severe jobs-housing imbalance that we face today in Palo Alto,” Krop said. “We cannot house our police, our (firefighters), our teachers, our workers. All our emergency workers are commuting hours. We just don’t have the land to house our workforce.”

City Manager Ed Shikada also addressed the county commission and suggested that allowing Stanford to build housing in surrounding communities to meet its requirement for academic growth would have three impacts: traffic, constrained housing supply in these communities and potential loss of tax revenues.

“The city certainly supports maximizing the provision of housing for employees and students on campus, certainly in excess of 70% if possible,” Shikada said.

Historically, Stanford has built or bought far more housing for staff and faculty off campus than on.

Geoff Bradley, a consultant with M-Group who has been leading the county’s update of the Stanford Community Plan, noted that since the current plan was adopted in 2000, Stanford has built fewer than 70 housing units for employees on its campus. (This does not include the hundreds of units it built for students, including the recent Escondido Village complex for graduate students.)

At the same time, it bought or built 1,991 units for its faculty and staff on nearby properties in Palo Alto, Menlo Park and Los Altos.

This includes the 628 dwellings in the Stanford West complex on Sand Hill Road; 180 at the University Terrace housing complex in Stanford Research Park; 215 in the Middle Plaza development in Menlo Park; and the recent purchase of 760 apartments in the Oak Creek complex.

Stanford’s campus currently has a total of 942 units for its faculty and staff, Bradley said, and about 67% of employees live off campus.

Based on this trend, county planning staff proposed that Stanford be required to provide at least 70% of new housing on its campus and at most 30% in surrounding communities near the campus, which mostly means Palo Alto. The Planning Commission on Sept. 28 unanimously endorsed the 70-30 split for on- and off-campus housing.

The new strategy aims to create more balance than there has been in the past, Bradley said.

“This policy flips it and says, ‘To get this more in balance, 70% of the new stuff … would need to be built on campus,'” he said.

Stanford objects to proposed 70-30 split

Stanford, for its part, has objected to the county’s proposed 70-30 split, saying that it’s too limiting. The county should allow the university to construct new residential developments anywhere within the 6-mile radius of campus and within half a mile of a transit stop, Stanford wrote in a letter to the county.

Stanford also pushed back on a proposal by the county staff to eliminate a provision in the existing community plan that gives the university the option of paying an in-lieu fee rather than constructing new housing. These proposed policies, Stanford posited, “create unnecessary barriers to building the required housing, especially in nearby jurisdictions.”

Erin Efner, Stanford’s associate vice president for land use and environmental planning, argued that the proposed addition of so much new housing on Stanford’s campus fails to consider the actual living patterns of existing employees.

“This is not where the overwhelming majority of Stanford affiliates live,” Efner said. “To further construct it doesn’t represent the actual demand.

“It also stymies Stanford’s ability to go into other nearby communities and attempt to make positive contributions to the housing crisis that we are still in.”

County staff note, however, that nothing in the new community plan precludes Stanford from pursuing other housing projects in cities close to its campus, as it has been doing in recent years. These projects, however, would have to be pursued in addition to — rather than instead of — the campus housing, which would be linked to any future proposal for academic expansion.

Planning Commissioner Marc Rauser was particularly sympathetic to Stanford’s argument and suggested that banning in-lieu fees would represent a significant policy change. It would also be a risky one, he suggested, given the difficulty of predicting demand among staff and faculty for housing on campus.

“I kind of have the feeling we’re moving the goalposts,” Rauser said.

The Pasteur Drive conundrum

The commission’s recommendation, which the county Board of Supervisors plans to consider on Oct. 17, could have significant ramifications for both Palo Alto and Stanford.

The Palo Alto City Council is in the midst of deliberations about upzoning three Stanford University-owned sites so that they could accommodate hundreds of housing units. This includes a site on Pasteur Drive and Sand Hill Road where about 450 apartments could be built, according to the city’s recently adopted Housing Element.

City planners noted, however, that Stanford would limit this site to its affiliates, a restriction that Council member Pat Burt said he found problematic. While this would help Stanford meet its requirements under the proposed housing plan, Burt suggested that this “diminishes the availability of housing for people who work in this (Palo Alto) community.”

Burt went so far as to express concerns that Stanford could turn Palo Alto into a “company town.”

He also noted that as a nonprofit, Stanford would not have to pay property taxes, a key revenue source for the Palo Alto Unified School District.

“We have the obligation — our school district does — to educate those students, and they don’t receive any property tax despite being a basic aid district,” Burt said. “Yes, it does diminish demand that those Stanford employees might otherwise have in our community but those other concerns outweigh that.”

(While Stanford-owned properties are largely exempt from property taxes, the university sued the county earlier this year to try to gain additional exemptions.)

It will ultimately be up to the Palo Alto council to determine whether it wants to upzone the Stanford-owned property on Pasteur Drive, which is near the Stanford University Medical Center. The Pasteur site is one of three Stanford-owned properties that the council is considering rezoning to allow more height and density. Under the current proposal, the height limit at all three would be raised from 50 feet to 85 feet and density restrictions would be relaxed to allow more units to be constructed.

But last week, while the council generally supported moving ahead with the zone changes, Burt and others wondered if the new Pasteur building could be made available — at least in part — to the general public. The county’s Planning Commission briefly considered the idea at its Sept. 28 meeting and Bradley suggested that having some housing available for both Stanford affiliates and the general public can provide “a shock absorber between supply and demand issues.”

In other words, if Stanford affiliates don’t want to live in the projects next to the campus, these units wouldn’t have to remain vacant.

Efner, however, strongly objected to the idea of mixing Stanford affiliates with the general public. Allowing such a mix would be “a big policy shift that we’re not even remotely prepared to commit to.”

“This would be pretty much a seismic shift from how we’re currently operating our housing program,” Efner said. “Stanford has built housing specifically for the community but … mixing students and the community would be very problematic.”

Gennady Sheyner covers the City Hall beat in Palo Alto as well as regional politics, with a special focus on housing and transportation. Before joining the Palo Alto Weekly/PaloAltoOnline.com in 2008, he covered breaking news and local politics for the Waterbury Republican-American, a daily newspaper in Connecticut.