San Jose

Align zoning with General Plan designations for all sites planned for housing by April 2024.

Council approval of zoning changes

th San José Affordable Housing Overlay Zones - Identify areas for housing to be integrated into North San José and propose changes to the General Plan, zoning code, and Rincon South urban village plan to facilitate the production of all 24,000 planned housing units in North San José. To integrate affordability, identify North San José-specific Affordable Housing Overlay Zones that support only Industrial uses, 100% affordable housing, or market-rate housing that integrates affordable units into their developments. Rezone identified sites in the North San José Affordable Housing Overlay Zones through the sites inventory rezoning process. Sites that are rezoned are subject to the requirements of Government Code Section 65583.2, subdivisions (h) and (i), including: By right permitting of owner-occupied and rental multifamily uses for developments in which 20 percent or more of the units are affordable to lower income households A minimum site capacity of 16 units A minimum density of 20 units per acre At least 50 percent of the shortfall of low- and very-low RHNA can be accommodated on sites designed for exclusively residential uses or if accommodating more than 50 percent of the low- and very-low RHNA on sites designated for mixed-uses, all sites designated for mixed-uses must allow 100 percent residential use and require residential use to occupy at least 50 percent of the floor area in a mixed-use project. Communicate to the development community about the new program. As a subsequent step, identify additional properties, which have a pre-existing Transit Employment Residential Overlay (TERO) designation in the General Plan and zoning, that should also be considered for an affordable housing overlay for either 100% affordable or mixed income. When additional properties are identified, propose such land use and zoning amendments to these sites for City Council consideration. Apply the TERO General Plan land use designation and zoning overlay to sites identified previously for inclusion in the TERO but not included in the sites inventory. Sites were identified as part of the process to retire the North San José Area Development Policy in 2022.

Dec 2023: City Council approval of General Plan and zoning code amendments Dec 2024: Identification of additional TERO sites for application of an affordable or mixed income overlay consideration of amendments by City Council Dec 2024: City Council consideration of previously identified sites for a TERO overlay METRICS

Direct City resources to help meet the City’s goal of 20 percent of all North San José homes being restricted affordable for lower income residents. Prioritize City land acquisition in North San José for future 100 percent affordable housing new construction opportunities, then conduct Requests for Proposals (RFPs) to award development rights through ground leases to developers. Ensure that future City Notices of Funding Availability (NOFAs) for new construction prioritize affordable development proposals in North San José.

800 restricted affordable homes in North San José Two sites acquired with RFP awards & ground leases to affordable developers

y Infill Housing Ministerial Approval Ordinance - Adopt and implement a City Infill Housing Ministerial Approval Ordinance to streamline approval of infill housing developments that meet objective development standards without public hearing, qualify for a CEQA ministerial exemption, and include deed-restricted affordable units onsite, which could allow compliance with the City’s current IHO through the “Partnership for Clustered Units” option. Make minor revisions to the municipal code to facilitate use of the CEQA exemption for infill development in order to reduce project timeframes. As part of development of this ordinance and subsequent to its adoption, the City will evaluate its land use and permit processes and make further improvements, if necessary, to address constraints to the production and improvement of housing.

Dec 2024: City Council approval of Ordinance Jan 2025: Outreach to developers June 2025: Complete first evaluation of land use and permit processes improvements and implement identified modifications. Ongoing evaluation, reporting, and implementation will continue through Housing METRICS Catalyst Work Plan. Entitlement of 200 units per year using the new streamlined process during first years after adoption. Average 25 percent reduction in the length of time from application to planning permit issuance

Standardize city impact fees and construction taxes through the Development Fee Framework. The Development Fee Framework is intended to be a structured set of standards that can be used as a guide for implementing planned changes to existing fees and taxes for multifamily residential construction. The purpose of the Development Fee Framework is to simplify the administration and calculation of major residential development fees and taxes to provide transparency and certainty to the public and development community. Implementation of the Development Fee Framework is anticipated to include the following actions: An amendment to the San José Municipal Code to compile all impact fee sections into one location. A new City Council Policy that provides a guide to the application of existing fees and the City’s process for considering future impact fees. Additions to the City Development Fee Framework webpage to include development-related fees and taxes with a staff contact. Compliance with permit review timelines consistent with AB 2234 (2022).

Apr 2024: Fees webpage updated Dec 2025: City Council adoption of ordinance to amend municipal code Dec 2025: City Council approval of policy on Development Fee Framework METRICS

t of Residential Development Study Update - Conduct analysis every two to three years, or as market conditions warrant, and present to City Council on the Cost of Residential Development report that uses prototypical models of common types of multifamily residential construction in different submarkets within San José. The report will help inform on an ongoing basis governmental and nongovernmental constraints on the production of market-rate and affordable housing in San José.

Council presentations Program or fee changes identified and made per updated analysis

Update zoning code to allow housing in three Neighborhood Business Districts appropriate for housing (13th Street, Japantown, and Willow Glen).

Nov 2024: City Council approval of zoning code amendment

und Leases for Affordable Housing - Require every newly funded affordable housing development to be structured to convey ownership to the City of a site’s land and the City’s leasing of the land to owners of an affordable development for a nominal fee per year, or a comparable ground lease from the County or other public entity, to ensure permanent affordability and public site control at key locations throughout the City and to minimize future affordable housing preservation challenges. To the extent funding is available, negotiate the purchase of land beneath existing affordable apartments at key locations at the time of refinancing and/or resyndication of tax credits to increase the number of ground leases in the City’s existing affordable housing portfolio.

# and % affordable developments that closed construction with public ground leases each year % of all funded restricted affordable properties with City or other public ground leases # existing deal land purchases # affordable units permanently preserved

Increase the City’s Density Bonus by at least 10 percent above state statutory requirements, assess the effectiveness of an up to 25 percent increase, and identify other ways the City’s Density Bonus ordinance could be expanded to result in more affordable homes, include more pre-approved concessions and incentives, support expansion to a broader mix of affordability levels, and/or add CEQA clearance.

Study completed City Council approval of ordinance changes # of affordable units created through City’s Density Bonus ordinance Number of units by AMI category

Issue NOFAs for new construction of affordable housing that award points to incentivize creation of deeply-affordable permanent housing developments that serve special needs populations, to the extent the City is allowed under law. Focus on populations and protected classes identified as having highest housing needs versus supply in the Housing Balance Report (I-4). Special needs populations include but are not limited to residents with physical and developmental disabilities, residents experiencing homelessness, transition-aged youth, domestic violence survivors, and persons with HIV/AIDS.

NOFAs issued City Council commitments Goal of 15 percent of permanent units funded during 6th cycle occupied by special needs populations