Editorial: A breakthrough offer on Stanford hospitals

June 19th, 2009

Stanford University’s offer of $23.1 million in housing mitigation opens the way for timely progress on huge hospital rebuilding projects

Palo Alto Weekly,

The rebuilding of Stanford University’s two prestigious hospitals — the single biggest development project in Palo Alto’s 115-year history — got a major boost this week when Stanford announced it will pay a housing-mitigation fee equivalent to what any private developer would pay: about $23.1 million.

That amount is part of a package of mitigations that totals $124 million, most of which would be traffic and transportation improvements and payments to commuters who choose alternative forms of transportation over the life of the projects. Stanford officials outlined the mitigation offers in a 10-page letter to the city, as reported in today’s Weekly and earlier on Palo Alto Online.

Notably missing from the new offer is land on which to build housing, which medical officials say isn’t available to them. Stanford expansion is regulated under a “general use permit” that limits both academic and housing expansion by the university, and officials have become loathe to release land for uses they deem not directly related to Stanford’s academic mission.

In addition to the mitigation proposals, Stanford would pay an estimated $18 million in building-permit fees, based on project size, according to city estimates.

The $2.5 billion rebuilding of the Stanford Hospital & Clinics, Stanford School of Medicine and ancillary facilities complements a $1 billion plan for a major expansion of the Lucile Salter Packard Children’s Hospital.

Up to this point, as anyone who has followed the process knows, Stanford officials have maintained that the hospitals would be their own “public benefit” in terms of worth to the community. They cited a state law that exempts hospitals from having to mitigate housing impacts from additional staff and employees. They have taken the position that any discussion of mitigations would have to await completion of an environmental impact report, targeted for this fall in draft form.

The university has known it will have to somehow mitigate traffic impacts from the expected 2,200 or 2,300 additional employees the new, expanded hospitals would add to the Palo Alto area workforce — many of the employees in lower pay ranges.

The impact would add to a so-called jobs/housing imbalance of more than two jobs per household that has both benefited and bedeviled Palo Alto for a half century. The imbalance has forced many employees to commute long distances to get to jobs in Palo Alto, impacting traffic congestion over a wide region of California as well as on city streets.

Stanford abruptly dropped plans in mid-April for a major expansion of the Stanford Shopping Center, citing concerns about overloading the northerly quadrant of the campus in a way that might preclude some future academic expansion. The pullback also reduced the number of new employees by about 1,000, simplifying the environmental-impact analysis for the combined expansions.

While it is mind-boggling to think of Stanford being able to pull off a $3.5 billion set of projects in the midst of a serious worldwide recession, there is no question that the new hospitals would be a huge asset to both Palo Alto and the entire region they would serve. During construction, they would be their own economic stimulus to the region.

And Stanford has no choice but to make its best effort to succeed. It is mandated under state law to replace by 2013 (with a possible extension to 2015) its existing medical-care structures with buildings that will better withstand future earthquakes. The new buildings must meet seismic standards that didn’t exist a half century ago when the bulk of today’s medical center was built, when the Stanford School of Medicine moved from its earlier location in San Francisco.

Yet up to this point it appeared that Stanford was approaching the impending city-approval process in the same way it has learned to approach other challenges to expansion: by rallying its supporters and charging headlong at whatever city or county public officials were in their way at the moment.

But as we suggested in an April 17 editorial, such a “polarize and pulverize” approach cheapens the dialogue on this immensely important matter. We are deeply heartened by this new initiative by Stanford to engage the matter proactively and on the merits of the serious issues at hand.