Councilman Cory Wolbach, who crafted the motion to relax rules for building these units, praised them for providing "an opportunity for an extended family to live together" or to have a nanny or a caretaker live on site.

On Tuesday night, after hearing from a large crowd of advocates and a few critics, the City Council threw its own support behind encouraging more accessory-dwelling units (ADUs) when it approved a series of reforms that eliminate numerous existing barriers. By a 6-2 vote, with Karen Holman and Tom DuBois dissenting and Lydia Kou abstaining, the council also directed staff to come up with incentives that the city can provide to residents who build accessory-dwelling units, particularly if these units are made available for moderate- or low-income residents, seniors, people with disabilities and public employees.

At the same time, not everyone is ready to welcome new homes, particularly in areas that already have parking problems and where these homes are used as short-term rentals rather than permanent residences.

Also known as "granny units," the additions tend to be small, relatively inexpensive and dispersed widely throughout the city. Most importantly, they address one of the city's most intractable challenges -- its severe housing shortage.

A granny unit in Palo Alto is a two bedroom two bathroom home with hookup for a washer and dryer. The new cottage has been built where a family's pool used to be, and is situated behind the main house. Photo by Veronica Weber.

"I'm really hoping you will help pass the ADU ordinance so that he can continue to live in this community, which is where he's been raised among the people that he knows," Talbot said.

Dozens of people came to the meeting to the make the case for ADUs. Kate Talbot said she has two children, both of whom are approaching an age where where they will soon be moving out of her house. One of them, she said, "has special needs and will need help finding a place to live."

"We're leaving the choice of growth up to each resident in Palo Alto and I think that's really important," Fine said.

"It's a chance to bring the family close and keep them close, whether it's a parent or grandparent or a child with a disability," Wolbach said.

Some council members expressed similar concerns and urged more restraint in eliminating regulations. Among the biggest changes that the council approved was the elimination of the "minimum lot size" requirement, which limited accessory-dwelling units to those lots that exceed the minimum lot size of their zoning district by 35 percent or more (the policy, in effect, excluded more properties from pursuing ADUs). Now, any lot can include such a unit, regardless of size.

"The change is irreversible," Meisling said. "It will change the single-family character of our neighborhoods. It will have a negative effect on property values."

"I think we're tired of seeing large apartment construction all over the city and this is one way of reducing the need for this kind of construction," Stolee said.

Richard Stolee said he thinks the small units represent a big "win-win" for the community. They allow family members to stay together, to share finances and to assist each other with child care. They also have a relatively low impact on the community, Stoler said.

Tom DuBois tried unsuccessfully to remove several provisions that increase the allowed density for these units. His proposal to do so was defeated 4-5, with Holman, Kou and Filseth joining him.

Councilwoman Karen Holman said she supports the broad effort to encourage accessory-dwelling units, but rejected the additional provisions proposed by Wolbach. Many of them, she said, will "have a very negative impact and negative reaction from residents."

"There is a real parking problem in town and we should be very cautious about handing out parking because we've done that too much in the past and we ended up where we are," Filseth said.

Councilman Eric Filseth called accessory-dwelling units a "logical way to proceed," but argued against relaxing the parking requirements near transit zones. He noted that the very neighborhoods that are located near busy transit areas (and are, therefore, eligible for the exemptions) are the ones where the parking shortage is most acute -- namely, downtown and California Avenue.

In addition to the state requirements, the council approved on Tuesday a laundry list of additional incentives, including ones that grant extra square footage to both types of units; relax parking requirements for accessory-dwelling units (currently, each unit is required to have two parking spots); eliminate door-orientation requirements; and limit accessory-dwelling units to 17 feet in height. Championed by Wolbach and Fine, many of these provisions generated significant debate and vehement dissent from their colleagues.

Palo Alto's ordinance will also allow the creation of "junior accessory dwelling units" -- a bedroom that is converted into a dwelling unit (which must have a kitchenette and be no greater than 500 square feet). These units are also encouraged by a state law that took effect in January.

Other changes were made to comply with recently approved state laws, which also aim to encourage more ADUs. Thanks to two recent bills, Senate Bill 1069 and Assembly Bill 2299 , cities are now required to allow conversion of portions of existing structures to accessory-dwelling units. State law also pre-empts cities from using development standards such as height limit and lot size to ban such conversions; and it waives parking requirements for accessory-dwelling units near transit. The city's new ordinance will reflect these requirements.

City eases rules for 'accessory' housing

Council relaxes parking requirements, scraps 'lot size' restriction in hopes of addressing housing shortage