A massive street improvement project along California Avenue in Palo Alto has driven street traffic to a trickle and caused businesses to lose up to 40 percent of their revenue, feeding frustrations among owners who aren’t being compensated for the losses.
The Streetscape Project, designed to increase foot traffic in the area, entails reducing four traffic lanes to two, widening sidewalks and adding plazas among other improvements. It began in March and was supposed to be completed by this winter. But the now $6.9 million project is already behind schedule and hundreds of thousands of dollars over the city’s original estimate.
The loss of business is fueling tensions between local merchants and the city government as Palo Alto shifts from a quaint town of small shops to a more upscale suburban metropolis.
“The California Avenue project stinks,” said Al Ghafouri, owner of Printer’s Café. “Everybody is having a lot of trouble on California Avenue. No exceptions. Everybody.”
Dissatisfaction among the California Avenue merchants was brewing before construction even began. Despite a unanimous city council vote in favor of the project, some business owners felt they weren’t consulted.
“I think that there’s a little bit of a disconnect between whatever the forces are that were really behind the project and the people that are here,” said Michael Ekwall, owner of California Avenue restaurant La Bodeguita Del Medio.
Project inspector James Beauchamp said he expects renovations to be completed in March 2015. But delays and miscommunications are leaving business owners frustrated and skeptical. “It was supposed to be done in August and now they’re thinking a year from Christmas,” said Steve Frank, owner of Avalon Yoga.
There is precedent for such concern. The Mitchell Park Library and Community Center was more than two years behind schedule and millions of dollars over budget. The Streetscape Project has already increased its budget several times as well.
The cost of replacing the fountain at the Caltrain station was projected to be $70,000, but is actually costing $647,000. Building sidewalks is costing $1.15 million compared to the estimated $700,000. Even planting and irrigation costs are over $70,000 above projected costs. Palo Alto officials attributed the sharp increases to design modifications and utilities upgrades that were added.
The city council, however, believes that such expenses will prove worthwhile. In the Feb. 14, 2011 meeting where the council approved the project, the city’s economic developer Thomas Fehrenbach cited several cities that had completed similar projects where business dramatically improved — some by up to 37 percent. Council members today agree that the potential downfalls and high costs will ultimately pay off.
“I think in the long term it will be a really good investment,” council member and former mayor Pat Burt said.
Some business owners, despite their woes, agree with the city council that the renovations are a necessary improvement.
“I walk that street all the time, and having to look out for four lanes of traffic, it’s insane. It’s just not safe,” said Kerry Hoctor, owner of Village Stationers. “By taking it down to one lane each way, it slows people down. Maybe you have a couple of people stuck at a crosswalk or whatever, but they’re stopping and they’re looking at your store, hopefully, that’s the whole idea. You don’t want them zipping by.”
Still, with property values increasing because of the renovations — and rents along with them — some business owners worry that California Avenue’s unique character is changing.
“There used to be a funky little bookstore, it’s becoming an upscale hot dog restaurant … there used to be a little Indian restaurant, now it’s an upscale pizza restaurant,” Frank said. “The Counter is there. Starbucks is there … most of the businesses are going to be chains.”
Burt, the council member, agreed: “The downside to it is that we could make it so nice that it becomes gentrified … driving out small businesses.”
Either way, owners can agree on one thing: the project is here to stay, and they have to accept it.
“Whether it’s really impacting our business or we see it grow, I’m willing to pay the piper now to hopefully, when this is all done, have a beautiful California Avenue,” Hoctor said.
