Okay, it's 1 30, and this is the community and economic development committee, and we are in session.

Would you take the role, please?

Looks like we're missing a couple people.

Here.

Thank you.

Okay.

Moving through the agenda, we have no work plan to review and we have no consent calendar.

So we will move to the first report, which is the housing catalyst team work plan status report.

And we have a whole team to present.

Thank you, Chair.

Committee, good afternoon.

Jared Ferguson, principal planner with the Department of Planning, Building and Code Enforcement, joined today by Chris Burton, Director, Planning Building and Code Enforcement, and Eric Sullivan, Director of the Housing Department.

We're here today to provide you with the status report on the housing catalyst work plan.

Jared, the microphone's a little fuzzy, so can you get sure?

Is that better?

Yeah, that's better.

Thank you.

Okay.

So first.

Sounds really loud now.

Okay.

So first some background.

So prior to our current housing element, we established the housing catalyst team to work on the growing housing crisis in 2018.

To have multiple departments come together to work on the complex policy items to deal with uh housing, housing production, housing uh sorry, housing policy.

And as we look moved into development of our current housing element, which was adopted in June of 2023, we wanted to continue the work of the housing catalyst uh team and also created the first housing catalyst work plan.

Yes, it's sorry, that goes on.

Um the first housing catalyst work plan, which was meant to continue the work of the housing catalyst team, and also to um continue uh to work on the policy and strategy policies and strategies contained in the new housing element.

In January 2024, the state certified the city's uh housing element, and then following that in February, we provided uh in February 2024 and February of 2025, um, staff provided annual status reports on the catalyst work plan to the community economic development committee, and then following that a status report to the full city council with the uh via cross reference from the committee, along with the housing element annual progress report, which is due to the state April 1st uh each year.

And uh now I will pass it to you, Eric.

Thank you, Jared.

So Eric Soleil, director of housing.

So just as just place settings, as we look at the work that CED does, it primarily focuses on sort of our R and spaces within the continuum from unit preservation and the work that we're doing around soft story all the way through our production work and the work that we do across departments, run in center programs on the market rate side, and then the gap financing and the work that we do on PSH units.

So when we think about uh housing catalysts and the work we do in CED, it falls within this area.

And in particular, as we think through sort of our focus area work, one of our areas and goals is really looking at market conditions.

We just came off in December, the uh cost of residential development study, pass forth additional incentive programs.

So, where do we also then further ground this analysis in thinking through some of the challenges for those projects that are underway?

I'm gonna talk through here just a few slides of the beginning part of an analysis that we're gonna be wrapping up here in the next couple of weeks that takes the broad overview set forth in the cost of residential development study, then the work we're doing around incentive programs, and then where does that sit in terms of linking capital and land for trying to identify more additional barriers to get into more production?

And so those market rate conditions then speak to sort of the data analysis that we've done.

Let's look at where pricing is.

Let's look at the affordability challenges grounded within the data analysis of the projects that are coming through our processes, and then how our incentive programs can hopefully move those forward.

And so the first phase of this analysis that we've done is looking first through everything that is entitled.

So there were 31,000 units entitled, over 103 projects, and this slide just breaks them down across council districts, which is obviously three encompassing the Google project and its initial commitments, drives a lot of this work forward.

So, with this broader analysis, we then looked at the next level.

How do we overlay that against the cost of residential development to see what are probabilities of projects for moving forward, projects that are feasible and infeasible?

And then the next round of analysis that we have going on is going to be where can we dig a little deeper into a subset of these projects to better understand some of those challenges as we're trying to catalyze more housing production.

And so this next slide does the first overlay, which is looking at the feasibility of projects and looking at the affordable versus market rate breakdown, which is our slide graph on the left.

So of the 103 projects, 31,000 units, you see the majority of those are coming up on our market rates side, just over 60%.

Then the graph on the right shows what is that unit breakdown in terms of the types of developments.

Again, sticking within the framework provided by the cost of residential development.

So we have towers, wraps, podiums, stack flak town homes, and single family.

So this takes the global 31,000 units and starts to categorize them as affordable market rate, and then the types of build.

With that type of build, we then looked at feasibility.

So based on the findings and the cost of residential development, we know that your towers are very infeasible in the current economic environment.

Now, across that whole set of tower projects, could there be a few that can go?

Yes, there's always an exception.

Gateway is an exception, but gateways also heavily publicly subsidized.

But in general and doing an overlay of the cost of residential development study across the 31,000 units, we became with these categories of feasibility and infeasibility.

And you can see across those different types what that breakdown is between the two and how that disperses across market rate and affordable units.

And that's what the slide on the right speaks to.

So this initial study has really gotten us to a place where we're better understanding some of the more categorized challenges within housing production and beginning to sort of get through some of the layers of the challenges to see how we going forward can more directly tailor the different tools that we have, like the incentive programs for getting more housing built.

And so this next slide then just goes to as we're looking at this entitlement analysis.

Some of our findings here is getting to this detail around, you know, we're seeing that two-thirds of the projects just not able to go in this environment.

So, where do we look at either expanding, contracting, applying different tools on the affordable housing side and on the market rate side to look for ways to close some of the gaps?

And so some of the next work we're gonna be doing over the next couple of weeks is doing an additional layering across the different rent levels so we can better target this on an AMI type scale, and then two, how do we look at and bringing this back under our kind of focus area so we can understand in more level detail, you know, where can we get and find more of a refined tools to catalyze more housing production?

And so that's where that quick analysis.

I'm gonna hand it over back to Jared.

Thank you.

So these next two slides are showing our progress on the regional housing needs allocation or RENA.

So this is a key component of our housing element.

The RENA is a uh allocation of units that the city is supposed to produce in the eight-year planning period of our current housing element, so from 2023 to 2031, and each year we need to show how we've progressed within our housing production towards that overall goal.

So the number the units are counted by calendar year, and this is uh a component of what goes into our housing element annual report that we submit to the state.

So this first chart shows our uh performance in the last calendar year in 2025, and so this is units permitted.

So these are units receiving their building permit, which generally means they're starting construction, and that's the key metric for showing progress on RENA.

The blue chart shows the actual number of units receiving permits, and then the orange chart on the right shows what the um annual goal is based on that overall eight-year period goal, which are eight-year RENA number is 62,200 units if you recall, and so on the far side the total there, the 7,775-that's one eighth of that eight-year goal.

So, in this last year, um we had a number of units permitted in the moderate income category.

Um so moderate and above moderate, those are unrestricted or non-deed restricted units, and so based upon analysis of rents, uh, many of those uh fall into the moderate uh income category for this year.

This next slide shows our overall progress on RENA through the uh entire planning period to date through December 31st, 2025.

And similarly, you can see the overall goal in orange to the left, and then the actual uh numbers in blue uh on the left.

So getting into some of the work plan highlights, one of the the key items that the staff has been working on this past year related to the housing catalyst work plan has really been encompassed in our general plan four-year review work.

Very loud.

Um, and so encompassed in the general plan four-year review uh has been some key housing element program items, which are also key elements of the housing catalyst work plan.

Uh so if you recall, the city council approved our scope of work for the four-year review last June, and we've kicked off the work with our task force, which is the planning commission starting in October.

So, there the overall goal of the this year's or sorry, the current general plan four-year review is both to advance the current programs in our city's housing element, the sixth cycle, and also to better prepare ourselves to for the next seventh-cycle housing element.

It's really about how do we add capacity and how do we continue to advance key programs in the housing element.

So the small multifamily housing program P35, our missing middle housing work is a key component of the four-year review, which is an important program within the housing catalyst work plan in our housing element, and then also uh P40 uh evaluation of our urban village planning process.

So the task force has had uh three meetings so far.

Uh the meeting in November was actually related to item P40, and discussed a number of strategies to streamline or speed up our urban village planning process to further the evaluation necessary as part of P40.

And then coming up next week, we'll have our first meeting on missing middle at the task force on March 4th.

So we're continuing to advance that work, and as I noted, you know, trying to prepare ourselves for that January 2031 deadline for the new housing element.

So making sure that we have enough housing capacity to accommodate that that work, although that shifted recently with with SB 79, of course.

So going into additional updates on items.

So we had a number of completed items in the last year, calendar year in our housing catalyst work plan.

So two items that were uh approved fully by the city council and in January, um January 13th of this year.

So uh P11 allowing SB9 type housing on additional properties, and then also uh a program around um updating our zoning ordinance to comply around group homes for seven persons or more.

Those were both included in the large zoning ordinance update that the city council approved on January 13th, and then looking earlier in the year, uh the broader income housing strategy P 15.

We presented that strategy to this committee in May of 2025.

So going into some additional work plan updates or highlights.

So when the state approved our housing element or certified our housing element in January of 2024, in that letter, they had a number of programs that they highlighted in our housing element that they said that they would be monitoring closely as uh as we progressed through the housing element um cycle.

So the programs listed here are those specific programs mentioned in that letter.

Um so the first uh first two have been completed so far, our city infill ministerial approval ordinance that was approved in December of the year before last.

Um and we actually had our first uh project entitled under that um pathway this fall.

Uh our housing balance report I 4 has also been complete.

Um P4 is in a program for additional affordable housing tools in North San Jose.

Um this is kind of an add-on in addition to the overlays that we created to look at other types of tools such as potentially an expanded density bonus in North San Jose around affordable housing.

Um, we took a look at this, you know, especially in relation to our recent cost of development report, and don't feel that additional tools um would be beneficial at this time, but we want to keep evaluating um if there are other tools we feel like could be uh leveraged there to advance affordable housing in North San Jose.

Um P9 is a goal uh affordable housing production goal in Deirdon.

Um so there are some been ongoing efforts there to try to encourage greater affordable housing in the Deirdon area, small multifamily housing P 35.

I mentioned that, as well as P40, the evaluation of the urban village process, those are both part of our four-year review, and again, one of those programs mentioned by HCD.

And then the last one, P40 revising uh reviewing and revising our permit conditions.

We're currently under uh undertaking that work and expect that to be completed by fall of this year through through various zoning ordinance changes, and I will pass it back to Eric.

And so then just to wrap up here overall, as we look at some of our other work that we do in the housing display regarding anti-displacement.

So the work we do around soft story continues as we brought forth during housing day, the pilot initiative will be ongoing.

Our eviction, uh prevention activities, a lot of that continues forward as we're gonna be bringing for sort of some studies uh related to uh courts and uh how do we best look at the existing programs we do in the courts to further anti-displacement initiatives, and then tenant preferences were finalizing regulations there based on the item that was passed at council uh about a year and a half ago as we're looking at ways to best implement that policy and continue to address displacement issues.

Uh new dialed items.

One is our IHOs, we completed updates to the IHO.

We have our mobile home ordinance that'll be coming back later this fall, and then just the work again building on the work that we discussed earlier in the presentation about how do we best look at tools and opportunities to link land and capital in order to catalyze more projects into going forward.

Then lastly, here just quickly on next steps.

Um, so you know, on February 25th, you know, we have the joint study session, which is tomorrow, uh, that we're doing with PBC and housing.

We have our focus area update on March 10th.

On the 24th, we're coming back to the full council on this update report, and then just the ongoing work we do across the departments and the housing catalyst.

I think there's one more slide, one more slide, and that's the last slide.

Yeah, I think that's it for sort of the wrap-up uh for our housing calendar support.

We're happy to answer your questions.

Thanks.

Thank you.

Thank you for all of the detail.

You've been very busy, and it I think it remains to be seen whether the incentive programs that we implemented and extended in January will actually result in any new developments, but we're hopeful that they are, of course.

Uh I see no members of the public here in the audience.

So I'm going to turn to the council.

Uh council member Ortiz.

Thank you so much.

Um, Madam Chair, uh, thank you to our staff presenters, really appreciate the work gone into uh this report.

A few items I'd like to comment on in in regards to uh arena goals.

I know this council's talked a lot about us um outperforming our our peers here in the Bay Area but still not reaching kind of the set goals um put forward by the by the state.

Do we have an understanding of how these arena goals are being calculated and like is there actually feasibility uh being brought to that discussion?

Yeah, so that that's a great question.

And so we we did have some of this analysis in this memo a little bit.

We looked um at kind of looked across other jurisdictions to see how they're performing in terms of arena progress, um, and and we kind of have the uh number of breakdown within that table.

Generally speaking, in the Bay Area, we're we're doing slightly uh better, but comparative to those other jurisdictions.

Um, looking more at um, you know, southern uh Southern California, they're doing slightly better, but most jurisdictions are significantly behind in terms of their overall arena progress.

That's great.

It's funny we're we're doing better, but I think didn't the state just like refuse to designate us as like a pro housing city or something like that.

I thought I I saw that.

So it's funny that we're doing better than the surrounding cities, but the state still doesn't consider us a pro housing city.

We're actively working on that now, so feel pretty pretty confident.

There were some complications with the initial designation, but overall we we should be receiving that fairly soon.

Yeah, I know you guys are are doing good, and you know, if we're doing better than our peers, I think that's something that we should be uh proud of.

Of course, we should always strive to do better, and I I look forward to looking at ways we could streamline housing production or you know, find ways in which we can improve our permitting um process.

My next questions are in regards to the urban villages, and I know um I have one already completed in my district, and we're going through the process in um Alum Rock East, and then who knows in the future may look at Story Road.

Um I'm happy that we're making changes on those, but I've been recently meeting with uh developers and who've told me in in you know shorter words um than they than they would use, but that they just don't work, that there's no incentives to urban urban villages.

And so have we really been identifying like our return on investment?

Because I know that these urban villages take a lot of staff time, they take a lot of uh uh community engagement.

Um, but then at least in my district, majority of the projects that go through the pipeline don't even come to the council and they don't even have to uh conform to the urban village.

And so I just want to make sure that we're using staff time wisely and that you know we're actually able to see uh um you know levers pulled for housing production.

Thanks, council member uh Chris Burton, director of planning building code enforcement.

It's a it's a fair question, a good one, and it's definitely something that we uh continue to monitor over time.

I think the important thing is to understand some of the mechanisms involved in how we establish the urban villages, which is ultimately to say that they're commercial areas, and they remain sort of largely commercial areas until we go through and do that planning process with the idea that we're unlocking housing.

Now, we've certainly heard the criticism around some of the challenges related to them.

Um I think as we think about the kind of uh land use planning of the city overall, um, you know, we're really cognizant of what we're giving up in this process.

So when we did completed the general plan update in 2011, we essentially said we were gonna focus the vast majority of housing growth into already existing commercial areas.

Um, and so you know, at that time we decided we would put a process in place to limit that growth.

It wasn't just turn it all on immediately, because you know, we are giving up a considerable amount of commercial area.

Now, the other thing I I will say is that over the last five, six years, we've seen somewhat unprecedented change in the way that we have to do our work, just given some of the impacts that the state has created by uh providing a lot of uh new direction and and sort of legislation around land use that's kind of upended much of that process.

So, in addition to having to consistently shift and sort of work around that, um, it's also consumed a considerable amount of the capacity that we have available to do that work.

So, as we look out into uh the next fiscal year, something like 70 plus percent of our citywide planning time will be dedicated entirely to playing catch up on state laws versus this sort of proactive work that we wanted to do around urban villages.

Um, so you certainly hear the criticism, certainly through the four year review process, we'll continue to look at how we do that, how we go about it.

Uh, but I think just sort of, you know, we're also balancing all of the work that's coming at us from different angles.

Do you do you know, this uh honest question, I'm not necessarily I don't necessarily have an answer to this, but do you do you feel like there are benefits to moving forward with these urban villages, or should we be exploring a different strategy?

So we I do because the alternative would be just to turn on all the residential and let the market decide.

And I think you know, the challenge, and as we've seen in places like Alam Rock, right, where there's a considerable amount of projects that come through.

Well, so but you know, but we're losing all aspects of that control, and in fact, some of the planning work that we do at a very granular level becomes much more important because we get to say, no, let's carve out these parcels specifically for commercial to preserve that capacity and opportunity, versus just saying residential can go wherever it wants, whenever it wants, um, you know, and we'll very quickly erode at what we have in those areas.

What about embedding you know incentives?

You know, we talk about you know the the downtown incentive, the infill incentive.

Could we be thinking about how to if we want actual growth in these areas?

Are we are we considered embedding, you know, development incentives in these processes?

So we we do have the multi-family incentive as well that mirrors the downtown incentive, and we have seen some success on projects uh through that program.

So I think the opportunities there.

I think you know what we've seen through the cost of development study and just through our experience in the process, um, is just the economics really don't lend themselves to the type of development that we really wanted to plan for and see in the city.

So the vast majority of growth that we planned for in the general plan in 2011 really focused on multifamily denser development in a more concentrated area, and as we've seen, you know, repeatedly the market's just not there, it's not supporting that.

Where the market wants to be is at lower densities, typically in the sort of town home stacked flats.

The market would happily build single-family residential if we let them take over the land.

But you know, from a long-term land use perspective, it's it's really about how do we maximize the opportunity on the land that we have left.

You know, the vast majority of the hundred and eighty square miles of the city is already built out, and so how we continue to use land within those boundaries is incredibly important.

Okay, thank you.

Uh and finally, I just want to say I I really appreciate the work from the memorandum brought forth from some of the council members here regarding the fee deferrals.

Um, really appreciate that.

Hopefully, we can see some some progress.

Is there any timeline on when we think that that will be instituted within our systems?

Yeah, so there's a couple of different moving parts related to that direction that came through uh rules that we did provide a green light.

There's the sort of framework aspect, so the development fee framework, and then sort of the process for fee deferral.

So some amount of that requirement already exists in state law, and really we're aligning all of the city process with that.

It's not something that requires an approval by city council to implement, but it is something that will be back to you this calendar year to give you an update, probably in the fall about how that's progressing and how it's been implemented.

It's something that uh because of you know, we have projects that are coming through now that you know want to take make use of that.

Um, some of the incentive programs already have a requirement around that.

So it's really about aligning everything with it.

So we'll either provide an update through a standing committee item or through an info memo to the city council.

Okay.

Thank you.

Appreciate it.

Thank you, Councilmember.

Councilmember Casey.

I should have turned my light off.

Councilmember Ortiz stole my thunder there on the urban village question.

So I appreciate his questions and the answers.

So I'll yield my time.

Starting, Councilmember Mulcahy.

Thank you.

Umber Ortiz took one of my questions, which was good.

Um I wanted to tell me Eric, you can talk about the feasibility in feasibility study that you've done.

And can you talk a bit about um like what data sets you're sort of relying on, and then what interaction are we having, really understanding go no go from the development community, right?

Because there's certain levers that you know we're trying our best to control, and understanding, I think some of the other headwinds in a real on the ground sort of way, I think is helpful, but probably the best source of that is from the finance market and from the developers themselves.

Is I'm assuming that's a big piece of it, and maybe talk a little bit about that.

Yeah, so the feasibility study looked at what is currently entitled, right?

What is the projects that have been submitted uh and entitled and what's their build type?

And then we overlaid that with the cost of residential development to see where does that fall on the line of feasible versus infeasible?

And that's where we're getting to, you know, over 60 are infeasible right now because of the bill type that they're filing for.

And so with that challenge, yes, there is market challenges to it, and there's also a broader uh challenge in looking at within San Jose, what are the conditions in which those financial markets need to operate?

As we saw in the cost of residential development study, we're not seeing market rate rents grow within, particularly in downtown and in some of our urban village areas.

Two, the cost of construction for union versus non-union is beginning to flatten out at the higher end of that scale, and then three, as we're looking at the build types that are feasible where the areas of utilization for that feasibility to execute.

So in looking at that next, and the next analysis we're gonna do in the next couple of weeks here is drilling that down to so we know where the rent schedule is citywide based on our quarterly reports, and in surveying, because we can't get through all 103 developers, in surveying developers, what are their real kind of challenges?

This is a lot of the work that we're building on from the incentive program where we underwrote particular projects so we know which ones can go and really have a green pathway forward.

What are those other challenges beyond financing so they can put their financing together?

What are their other challenges that they're facing in order to get projects out of the ground?

And so we're gonna encapsulate and capture some more of that so we can take sort of a 10,000 square foot view all the way down to about a hundred feet off the ground, where are the challenges in getting projects to finance, to process, and to move into construction.

So especially on the affordable side, right?

We have to rely on a lot of other funding partners to our have our money actually make any sense to be involved.

Um what are you know, what are you seeing in the California kind of colleagues, if you will, recognizing the challenge that the state provides, because you know, there's a lot of money available, but you got to go to seven different asks or whatever it is to be able to sort of pull that funding stack together.

Yes, there's any efforts with you and your colleagues across the state and trying to effectively change that issue.

So there's a lot of work we do through IGR through my calls that I have monthly with San Francisco and Oakland just within the region as a major cities to look at the challenges we have of getting through the processing on the state side, because through HCD, through your LITAC, through your debt through SEDLAC, like all of these different processes creates a heavy burden on developers just to move through that system.

And the alternative is for cities and municipalities as funders.

You know, in the past, the city was first dollars in, then waited three years for something to actually go through the process.

Now we've shifted that to close to the last dollars in will bring two projects forward that are at that last moment.

We're filling in the gap to move it forward.

But overall the state processes are not aligned to where cities are.

We've aligned our RFP processes to hit some of those deadlines but there's still challenges to one and a lack of acknowledgement of the infeasibility of the ways in which they want to drive AMIs still the you know tax credits are driving the AMIs to the ground yet a lot of municipalities want to have you know towers and podium bills which those two things don't align.

You can align your revenues to your costs if you're doing that.

And then SEDLAC and HCD have so many review processes involved we're killing these projects before they can move forward unless there is a hard and steadfast commitment to finance them no matter what.

We took four years until we were able to align ourselves the county the housing authority and TCAC to support that project uh to get it out of the ground and downtown.

So that is an example of some of the headwinds that we have to have a significant alignment in order to push things through at the state level and we're making progress but there's still a lot more work to be done.

Thanks for that Madam Chair did we get a motion to accept the report we did not.

So I'd make the motion to accept the report.

Cross-referencing and cross-reference it to the city council seconds.

Great thank you.

Councilmember Kamei thank you so much and Councilmember Mulcahi took my question so there you have it.

But I but I you know as we uh work on all these complex housing issues you know I'm wondering at what point um do I mean actually the majority of of the um uh housing uh that has been permitted you know if they don't build in two years three years four years five years six years you know I mean I know properties that are kind of languishing uh many of them have completely taken everything out and so it attracts a lot of nuisance uh and and I'm wondering at what point do we say no you're not gonna get an extension and I don't know if this is a question more for Chris or because there are not all of them right but but some of them were were done at a time of speculation and they have taken everything out of the property and when you get a lot of weeds and grass and you know graffiti and all kinds of things it's a problem in certain areas.

So I'm just wondering at what point do we say no we're not gonna extend uh um you know this this this uh this housing project and and you know do something different.

Yeah thanks council member so typically when we do land use approvals um they include a time condition right which is two years plus two one year extensions um again the state continues to contribute to our work because they've passed legislation um you know that now extends that further um so we're still sort of trying to to figure that out but it is an ongoing issue and it's an issue that's really um uh embedded within this sort of speculative entitlement work that we see a lot of in San Jose where you know there's an opportunity to really uh either up value on the land um and try and sell it to a developer on the back end or you know while folks are trying to line up the financing around the development you know things either take too long or something happens um now on a a case by case basis we we have gone in and looked at you know some projects that maybe we do want to extend um for a while during COVID uh we did blank extensions across the board to say like all permits approved within this area will extend um but we wanted to move away from that process for this very reason.

We continue to see this issue.

And so now um if a development wants to to move through and extend those entitlements further, we take it back through a hearing process, so through a development permit amendment um and that's that's one of the things we look for um now obviously the other side of PBCE takes this on when it sits vacant for a long period of time.

So, you know, we do have a vacant building ordinance.

We do require people to register their properties, so uh it is an ongoing challenge.

Obviously, our preference would be uh to keep those those properties with tenants in place, um, but certainly understand the challenges that developers face in those moments as well.

I just I just wanna caution us all as the number you know, as the number of those that are not able to build is higher than what you're able to build.

Uh I I think that at some point, you know, they're never gonna build it.

And so I just I just know that, and I'm sure other areas in San Jose have experience where there's a vacant, you know, they've taken everything out, and it's just become a nuisance area.

And so um that's something I think to watch over, uh, especially because 60% of those who have entitlements have not built.

And who knows if they will ever build.

So thank you.

Thank you.

Good good point.

I have a signature project in my district that's been uh hasn't moved forward since we approved it several years ago, but we're still hoping that it does.

It it it they haven't demolished the property yet, there's still tenants in there, but we're hoping that at some point it will actually go forward and it might be towards the end of this year that we have some movement, at least we're we're hopeful that way, but it's it's the difficulty of not penciling out, even though the intent is there to build if they can't afford it or it doesn't make sense and they can't get the financing.

So it's uh but I understand the concern about the blight because that exists too, and that creates uh a negative impact on the community that surrounds it.

So thank you.

Thank you for that presentation, and let's vote.

Do we need okay?

Wondered if we needed a voice vote.

That motion passes unanimously.

Great, thank you.

Moving on to the next presentation, which is the cost of special events audit status report.

Are we gonna move to them about this?

Good afternoon.

My name is Carrie Adams Hapner.

I'm the director of cultural affairs in the Office of Economic Development and Cultural Affairs.

I'm joined today by my two colleagues, Jen Baker, who is the director of the Office of Economic Development and Cultural Affairs, which I will now refer to as OEDCA, and Melina Iglesias, who is the special events director.

So we're here today to give you an update on the cost of special events audit and its implementation.

Um we are asking that you accept the status report on the implementation, specifically related to recommendation number four, which is about permitting coordination and timely invoicing.

So last year the council accepted the city auditors report on city costs for outdoor special events, and at that time the council did direct the administration to return to the committee, um, specifically related to recommendation number four.

And I do want to say that um our office and in fact all of the departments that are involved in the permitting and coordination of outdoor special events are taking this audit very seriously.

And while we're only going to be talking about recommendation four, I do want to share that we've made really good advancements on the other recommendations.

So um I have a couple other things I just want to mention about recommendation four.

Um it focuses on customer service through better coordination or consolidation of the permitting process and also formalizing timely post-event invoicing procedures.

So today's update will outline progress, constraints, and next steps toward the June 2027 completion target.

So Molina Iglesias will be leading us through the rest of the presentation.

Thank you.

Thank you, Kerry.

As Carrie mentioned, the recommendation four has of two parts to it.

The first part really focuses on coordination and the potential technology enabled coordination, consolidating system for all of the event services.

Right now, every department that touches an event, provides a service, or a permit has their own system that they work through.

So this would be a great efficiency for us and really result in a shift in our delivery of customer service for more clarity and efficiency.

Part B focuses on improving internal processes to ensure timely invoices.

Right now, again, as I stated, the systems are all individual.

So they have their own process and their own timeline that they go through.

This would solve for a lot of those issues that we have with the timing of invoices post-event.

So just to start with, the administration assigned the recommendation a yellow status just due to the budget and the cross-department coordination requirements.

We are still targeting a June 2027 implementation, but we are making great progress throughout the other pieces of the recommendation as well of the audit report.

So progress to date, the police department has already implemented an e-proval system that has demonstrated improvements in online intake, permit tracking, and invoice capabilities.

So we're really excited to go through the process and what we've learned from them so far.

It seems like it would solve for a lot of the items that were in the auditors' report.

And so OCOEDCA is using this pilot as a reference point to evaluate citywide flexibility and how it applies to our services and service delivery model.

We've been working cross-departmental hosting discussions and coordination meetings with our partners in the different departments, and we're continuously assessing our workflows and looking to implement the system integration needs.

So on the billing side, also finance has already confirmed that this is a viable option, that we can have a consolidated billing model within the existing systems that we have in place and the controls for government finances.

And in the interim, staff are improving proving our internal coordination website updates.

As Carrie said, we are dedicated to and committed to this body of work, and we're looking at the low-hanging fruit, if you will, of what we can improve currently while we work to implement the broader system for our delivery service.

As we are super excited about this opportunity, we're also identifying the constraints and considerations that we have to take into account when we're shifting the way that we are working and serve providing our service.

So outdoor special events require coordination across multiple departments, and with each of them working in within a distinct workflow and recovery models for the cost recovery, excuse me.

So aligning these into a shared system requires technology integration and financial coordination, which again things seem to be in alignment with this being a feasible and viable option for us.

Now the real piece of it is the cost of it.

So preliminary preliminary estimates suggest anywhere from a 25,000 to 45,000 annual subscription fee for software licensing, plus the cost for implementation and staffing.

In addition to the any modules that we want to add.

So as we're going through the assessment of the workflow for each department's needs, that gets more complex.

So baseline is about 25 to 45,000 annually for subscription, which is great because it doesn't limit us on the number of users so we can apply that citywide to all of the departments.

So funding for the citywide implementation will be considered during the fiscal year 26-27 budget process.

So we're in the works of doing that now.

And I just wanted to point out that one of the more operational, if you will, constraints has been the increase of event, the events that we have, the event volume, and the complexity of events, events are becoming more innovative, more creative to create experiences that are unique for the event goers, which push us to continuous consider continuously consider our process and match with our industry standards as well.

So as we continue to work towards the implementation of the software system, this fiscal year, we're focused on improving the customer experience within the existing resources.

We are updating our website and adding more features for clarity, clearer permitting guidelines and updates, more user-friendly FAQs and resources for event organizers in our community to really help themselves as they go through the process.

We're also making ourselves available to our community and our event organizers for consultations and open house type of sessions.

Concurrently, we're evaluating the system and what it how it applies to our work and comparing with other municipalities and what systems they have in place.

And you know, implementation of a citywide solution remains targeted for 2027 for our goal as rec per the audit recommendation, and we're committed to this body of work and working to improve transparency, predictability, and customer service throughout the process.

Thank you very much.

That concludes the formal part of the report.

We're available for any questions.

Thank you very much for your presentation.

I see no one else has come to our meeting, so I will turn to the council, Councilmember Mulkey.

Thank you.

Thanks for the report.

Hey Melina, I've got a question, a few questions on the kind of the process that you're going through right now.

Um I know there was good information available to us, but on the like the costs model, for example, I think, and I don't know if any of my colleagues are having this too, but I think people have woken up since the Super Bowl and now thinking about doing events, and you know, already behind the eight ball, I think, in terms of being prepared, but curious on the cost modeling.

If I came into you today, could you give me a pretty good picture of what the cost would be if I wanted to do a partial or a full street closing as an example?

Yes, good question.

Thank you very much.

Um we do have some models in place, and those are parts of what we're improving on our website to have like a scale small scale, large scale, medium scale event, and what really plays into the um the fee or the cost for events are the additional elements.

So, yes, I could speak to you about a street closure event, what that cost.

Right now, the police department has waived their uh fee uh street closure permit, so it's a zero dollar permit for a street closure.

However, the costs really come into the labor for traffic control officers, the traffic control equipment, and those uh costs that uh support the activation of the event.

So, but as you've described the work that you're doing now, is that cost modeling process after 25-26 and into 27 of implementation?

Is that gonna be a more efficient process for you and less staff driven and more modeling, say on your website type of approach?

Yes, that is our intent, and that through the system that we're looking at, because it would be a shared system where all the departments would enter one application into one database, we all have access to it, we can see the elements of the event that influence the cost, and that would make it easier for us to really just kind of say this is an event within this category, and here is a cost estimate range for that that matches the event proposal.

So this is gonna be an absolutely loaded question, so others can chime in if needed.

But one of the things I think our producing community wants is certainty, right?

I think that's where a lot of this has come from.

Not just in can I get the permit, but do I know what the cost is up front?

Right?

We're trying to get our invoicing down because people were getting their invoices, you know, six or eight months later, or an oh, we just found this kind of bill, which I know we've heard these horror stories, but in terms of the certainty on the cost modeling, it do we have as a city plan to sort of put our stamp of like this is what we're committed to, or are we gonna have this situation where gosh, that was that was only an estimate, and you know, you're you know, we underestimated the impact of how your big your event was going to be.

Just curious how certain is that cost modeling going to be when somebody actually gets the bill on the other side.

So the answer is a little complex just because events themselves are complex and unique, right?

No two events are alike.

Um so it's difficult for us to say an event will cost this amount because not all events include all the same elements that you know apply to the cost.

However, um what is fixed is the permit fees.

The permit fees themselves are fixed.

What is static, uh excuse me, what is more flexible in the sense of cost is the labor because it's contingent on the elements of the event, the hours of the event, and that shifts depending on each unique event, which we love.

We love that, you know, if our event organizers keep us on our toes, they propose the coolest stuff that we get to see in our city, and it's exciting to be able to help them go through the process.

With that said, of course, we also, as for staff efficiencies and for clarity on the event organizer side, we want to make sure that they are that we are up front with the cost, they know what to expect because they're out on the other side, you know, going through sponsors and looking for funding services as well to make these great things happen.

So we want to be part of that solution.

So, in a simple answer, the permits themselves are fixed, and yes, we can give them um a base rate or a model of what it would cost on the permit side, the labor is what's um uh different because that's contingent on the event itself.

So if if I've got an event that two weeks out, we know is all you know, we're sort of getting this indication that it's gonna be 12,000 versus 6,000 people, the variability cost is we're gonna need more security, whether it's our own SJPD on that work or a third party.

But that would be the variability that we would communicate up front to a producer that hey, these are the fixed costs on the permit side, but I want to make sure you understand the variability.

We're basing this event on 6,000.

But if you grow that, you know, we may have to come in with additional security recommendations that would be borne by by your event.

And the hope is is that if they know that up front and their event is bigger, that's likely more revenue for them anyway.

But what I'm really trying to get at is this theme of certainty and the variability needs to be described up front as we're making these arrangements and planning and they're going through the permitting process.

And would you say that that's the flavor of the intention of what you're trying to do?

Yes, absolutely.

And to your point, we're actually clarifying our uh cost list on the website that includes the staffing cost.

So an event organizer can, and we have models in place, like if your event is uh, you know, four to six hours, it's a three hour minimum for police services or parking traffic control officers, so they can already start calculating.

One of the features that we're looking at with this new software is a cost calculator, so an event organizer when they apply, they can kind of put in some formulas of like with the duration of the event, what elements of the event, and it can kind of spit out a good cost estimate that would help them start off right off the bat knowing what they are looking at into cost.

And also our current process, and we're revamping this in that way where it's clarifying in standard operating procedures across the departments, is that um we are giving event organizers a cost estimate, and it has the disclaimer in there that as your event shifts or changes to your point exactly with the hours of event or elements if it grows or shrinks, um, that is subject to change and apply to reflect the um the final proposal of the event permit.

So it sounds like the linchpin to this is a 25 to 45,000 annual subscription to a software program that we would be reliant on to help us coordinate all of this.

Um, and I know that you've said a couple of times at your testimony, but also in the in the you know report that it's dependent upon funding.

I mean, it seems like if this whole program is dependent upon like us coordinating over an annual subscription, have we done some cost-benefit analysis on how much we would save in staff time and how much like we could avoid the aggravation that we cause our producers?

There's a cost and a value to that.

So I'm wondering if you've looked into sort of what that offset is for that expense.

I do not have the um number now, but that is part of the process when we make the proposal and um request the funding is a cost benefit analysis and cost analysis because you're absolutely right.

The efficiencies that it would bring, um, not only in the thought the minds of our event organizers, but also the time of everyone's um, you know, staff hours to work on the events would reflect in some significant um efficiencies.

So yes, that will be part of the process for the um the as we move through the funding request.

Cool.

Thank you very much.

Thank you.

Oh would you like to put I would like to make the motion?

Very good.

Would someone like to second it?

Second.

Very good.

Moving on to thank you.

Councilmember Kamei.

Thank you so much, and thank you for the report.

I think it's good that uh it's gonna be consolidated.

When is it gonna be available?

Because right now, if you go to the website, it takes you to a fill-in-the-blank kind of page, and you know, uh, you would have needed to know that you needed 60 days prior to to be able to get this going.

Uh, obviously, um, you know, I know it is gonna take some time, but will this consolidation, and I I'm glad that the uh the different departments are able to view, but one of the elements that was confusing is that different departments were sending different, you know, like it was different departments' responsibility to send invoicing.

So I thought, you know, will this bring it together, and when will we see this happening?

Yes, well, good news is that the police department has fully implemented an a system right now, they're using e-proval, and it's proven to be able to um uh solve for a lot of those points that you spoke to, which are also our pain points as well.

Um, but uh my understanding is that it took about six months for the full implementation for the police department, um, but I I believe that since um they've already have that model in place and we're using um looking to use because a scope will match that open um RFP process to be able to go through that existing system, which would make the implementation a lot faster since the it's already gone through the IT review uh for uh IT um systems.

Um so my understanding is that we can look into as easy uh as quickly as six months for a full implementation.

So if we get everything in place for June 2027, I you know it's can be uh contingent on how you know we roll in with um all of the department uh permits and services that they have, which is what I mentioned with the cost.

I want to be um careful that the baseline is 25 to 45,000, but as we add more complexities, more modules, which it looks likely that that will be our need because we have so many permits and so many services that we provide for the events that it may be more, and that's part of the analysis that we're doing now.

So I would say um, like from just using the model that the police department had, it took them six months to implement to go live.

Yeah, I think it's great that the police department has, you know, sort of got jumped ahead and and and done that.

But I mean, you have other departments.

I mean, just looking at all of the permits and permit types under city costs, you can see that is a whole array from you know, depending on location, depending on quantity, and you know, if I'm gonna have a really big event next year, and um uh I I submit my information, it it's going to take a lot of time individually, one by one as you put in this application.

Is there any thought of of kind of like triaging it before it gets to an individual uh as to the type of event so that you know for a smaller events, I know that the hundred is the kind of you can do it under the smaller types, but um those that are a little bit more complex that may need a health permit.

I you know, and that's not even us, right?

So um, I'm just wondering, you know, uh sort of to streamline it a little bit more in terms of how that would work.

So the new system that we're exploring will have an if this then that.

So it'll only take you, so if you hit you're having food or you have alcohol, for example, that's one of our permits.

If you have alcohol, it'll if you check yes, it'll take you to the alcohol permit, but it won't show you that permit if you're not already planning to have alcohol.

So, if you have a stage, you need a fire.

So as the event organizers fill in and add the elements of their event, it'll say, Oh, you have a street closure, you're gonna need a street closure permit, and it'll take them to that piece, and then it'll say you'll also have uh street closure equipment and street closure traffic control points that you'll need to account for.

So it'll be kind of the the workflow.

The menu, yes, which would result in a more simplified process because if you do not have those elements, you don't need to run through those hundreds of pages for that.

Yeah.

Well, I would say that I know that we're um kind of uh uh short on money, but I think that we're also short on time, and if this would save us time, it's definitely worth the investment, and it would be greater customer service for those who are um you know having these events, and I know that even for next year's uh 2027, people are already starting to talk about types of events that they want to have, and it would be really really uh helpful to you know have this sort of in the pipeline already uh so that at least you know it would be at least ready for for next year because we're hoping that you know FIFA is not the last thing that's gonna happen, that we really want other stuff to happen and even community to come together to have events.

Uh and I know that there is interest, but uh so I I hope that the sooner the better.

Thank you.

It'll all depend on that pesky thing called the budget and how we can allocate funding for these this particular program and then the implementation of it.

Okay, seeing no other hands raised, let's vote.

That motion passes unanimously.

Okay, great.

Moving on to the next report, which is the entertainment zone status report.

And I assume the same group is staying, or we have additional people coming down.

We are waiting for our colleagues from the police department to join us.

So joining the OEDCA team, um, we have Captain Torres and Captain Bible from SJPD.

Great, thank you.

Kiri Adam Sapner, director of cultural affairs in the Office of Economic Development and Cultural Affairs, also known as OEDCA.

I'm joined again by Jen Baker, our director, Melina Iglesias, the director of outdoor special events, and then again, our colleagues in the police department, and we have Jennifer Bible and Captain Torres.

So our recommendation is to ask you to accept this status report on the implementation of entertainment zones, including their effectiveness, cost implications, and then also some of the early lessons that we've learned to inform future activations.

And I want to just share with you that the city of San Jose was the third city in the state of California to adopt entertainment zone policy.

And so subsequently, we have become a model that other cities are looking to in terms of looking at our practices and our procedures.

So I I just do want to point that out because we're we have a unique model that I think is going to be very effective for other municipalities moving forward.

So as you recall, on May 20th, the council approved eight geographically defined entertainment zones, and then the council directed staff to return with an update on implementation effectiveness and cost implications.

So we're going to walk through that with you today, and I do want to just underscore that, you know, we took some time to pilot some entertainment zone activations in the fall, and then we were able to really um solidify our approach and our processes, and so we're very excited to share how that's going with you today.

But I do want to say it's also in a spirit of continuous improvement.

So we are constantly uh doing assessments and evaluation as we move forward.

So what is an entertainment zone?

So about a little over a year ago, the state of California adopted Senate Bill 969, which allows cities to create local ordinances for entertainment zones.

And then we adopted ours in May of 2025.

And essentially what it allows for is that designated geographic areas where those are the zones, and those in those zones, patrons can purchase alcoholic beverages from a licensed brick and mortar establishment and then take them outside to consume within this geographic area.

So essentially, they are taking to go containers into the entertainment zone.

And in San Jose, we they are not necessarily standalone programs.

They operate within the existing special events permit framework, and alcohol must be purchased from an ABC licensed brick and mortar establishment.

And the zones are temporary, they're geographically defined, and they're tied to permitted events.

And so this policy really balances economic activation with operational oversight and compliance.

And I will say that was the spirit of the statewide legislation.

It was really to assist brick and mortar businesses and small businesses in terms of economic recovery post-pandemic, but also to really ensure that we have a vibrant public life.

Thank you.

So as I mentioned, we have eight zones in San Jose, and it was per council approval, and it was they were established through a local ordinance.

And for these, you know, you can see we have seven in the downtown, and we have one in Alum Rock.

And essentially, we are in regular communication with ABC, and we are also engaged with our business districts as well as the ABC licensed establishments within this zone.

So Melina Eglesias is going to walk us through the rest of the presentation.

Thank you.

Thank you, Carrie.

So just to start, um staff prioritize proactive early engagement to ensure businesses, event producers, and community partners could clearly understood the entertainment zone framework before activation.

There's a lot of excitement around entertainment zone.

So we were very intentional in our outreach and engagement to for the education piece of it, but also for the safety standards.

So we launched a dedicated entertainment zone website to serve as a centralized resource, providing transparent guidelines, FAQs, and step-by-step information to support compliance and participation.

There's also a really cool business toolkit that speaks to the where, what, where and when for event organizers and for the community as well, so that the patrons are also this is a new tool for them to experience the outdoor event spaces.

So our targeted presentations were conducted with business districts, including Eastside, the East Side Sofa District, the South First Area, Post Street, San Pedro, and the Little Italy and Sharks Way communities to answer questions directly and tailor the guidance to each neighborhood context.

They all operate in their own ways, and so we were very specific to meet their needs and their specific spaces through this process.

So we supported a citywide webinar in partnership with the Downtown Association to prepare stakeholders for the SJ26 related activations and ensure consistent management and messaging across the districts.

We also are working closely with the Alam Rock Santa Clara Business Association and the Directors Alliance as they start thinking about activations for the summer FIFA World Cup viewing parties.

We continue to coordinate directly with the event producers to promote entertainment zones.

We want to again highlight that this is a new tool that they can utilize, and also to our brick and mortar operators of how to operate within the entertainment zone requirements and conditions.

And it's uh just about building familiar familiarity and consistency as we look through growing our experience economy in downtown or in our in our city.

As Carrie mentioned, we did get to pilot a few events over the summer that really helped us to showcase this as a tool, but also gained some lessons and some insight before the actual implementation.

So we worked with the San Pedro Block Party on San Pedro Street, the Community District Mural Celebration and Silicon Valley Pride kickoff on Post Street and the Big Easy Block Party and Beer Fest on Little Italy Sharks Way in the summer, this past summer.

And these pilots were intentionally structured as real-world operational text tests to evaluate feasibility across the varied types of spaces that we have events outdoor events and the different operators, the ABC license operators.

The assessments focused on operational coordination, public safety controls, alcohol management protocols, and the level of business participation within the defined boundaries.

From an operational standpoint, we'll share that the framework functioned as designed.

The pilots showed that this is allowing activation while maintaining clear oversight and alignment with existing safety systems.

The feedback from the business districts and the event producers has been consistent and constructive with solution-oriented feedback and insight.

Stakeholders have expressed an appreciation for the flexibility.

The businesses can now participate in this outdoor special event, whereas before only the one-day liquor license operator outdoors could sell alcohol.

So now this is now creating a whole vibe and connectivity within the business districts.

These pilots provided actionable insights.

Over the Super Bowl 60 weekend.

There was an estimated attendance of about 48,000 people, just that's preliminary over the three-day weekend, creating the sustained activity throughout the district.

There was a lot of connectivity from people walking around and going to different businesses, different areas, and it just felt very vibrant.

So this was what the entertainment zone was supposed to do.

The preliminary feedback from the San Pedro Square stakeholders showed that there are several establishments experience one of their highest grossing weekends ever.

So this suggests again that the economic performance within the defined zones through the entertainment zone is working.

The activation operated fully within the special event permit framework, so we had all of the controls and safety points in place to safeguard our public experience and ensure successful entertainment zone experience.

There was significant interdepartmental coordination that supported the activation, including our San Jose Police Department, our fire department, Department of Transportation, Public Works, and our Office of Economic Development's OCA's events team in partnership with the Downtown Association and San Pedro Square, San Pedro Business District stakeholders as well.

So this entertainment zone showed this experience showed that this type of tool can be scaled for high attendance nationally significant weekends while maintaining structured oversight and public safety controls.

So with the new tool, there comes learning experiences and opportunities.

So the entertainment zone is a new economic activation tool that is works within the framework of the outdoor special events.

We were uh gave us insight, excuse me, given the intersection of public space, licensed alcohol service, and event production.

Uh we approached the implementation process in phases.

So we learned a lot through the through the pilots and now through the actual implementation of the first official event.

Um this uh gave us an opportunity to um experience what it would like be like on this high level of activation.

So there was observations and opportunities that staff um experienced.

Uh we learned that we needed more clearly defined boundaries and visible signage to support public understanding of the compliance.

Again, it's not just a new tool for our businesses, it's also a new tool for our patrons and our public as well.

And some people were a little like, I don't can I take this outside?

This has never been allowed before.

So it was kind of that that new kind of way to work through that um that process and experience.

Um the standardized beverage containers.

We never thought that cups would become such a hot topic, but it was, and so um that was still continues to evolve.

We learned that through the Superfest at San Pedro Square, the cups needed to be a little bit bigger uh to fit the different types of beverages that are available from the brick and mortars.

Um, and then also understanding that we need more time to coordinate with our event organizers and our businesses as well.

They still need to do training for their bar staff, their uh the point of sale, um, and just more clarity again as we get used to it.

There were no incidents that took place um during that event itself, but it's um it was just something that we can refine and continue to improve on for the better experience.

So uh looking ahead, we have some cool stuff looking to look forward to in the summer of uh of 2026 where we have um the March Madness uh related activities.

We have music mania, FIFA World Cup related events, and we have city dance and um series in SOFA that we're looking forward to.

We're also in conversations with um some of our stakeholders for some cool St.

Patrick's Day activations on San Pedro, so looking forward to that.

Um so these activations that we have uh look really um represent a mix of locally driven programming as well as a major international event alignment.

So it's a kind of like we know we have these big um high profile events.

Now this is what we're doing with them in our to showcase our um assets in our city.

Um there's continued interest from the business districts as they are excited about this opportunity.

They had a great experience during the Super Bowl weekend and um they're coming up with great ideas and how to maximize this new tool.

We're in good conversations with the um the Little Italy and um Sharks Way uh community, and they want to do some really fun stuff to highlight their assets there, as well as working on the with the School of Arts and Culture and the Um the Director's Alliance on activations on Alum Rock for the FIFA activations.

So, next steps for us.

Uh staff will continue integrating entertainment zones into the growing our economy focus area reporting structure.

Uh state legislation does require us to review the program uh biannually, and the goal remains to support an economic activity while maintaining public safety and operational clarity through the entertainment zone program.

And that concludes the formal part of the report.

Thank you very much for your time, and we're available for any questions.

Great, thank you for that presentation.

It was really uh nice to have San Pedro Square activated so much during the the Super Bowl, Superfest week or whatever we called it weekend.

A lot of people down who wouldn't normally be down there.

So that was exciting to see.

I heard a lot of reports as I'm sure we all did from business owners down in that area who were so excited with the volume of business that they experienced.

So it's it was all good.

Um I don't see any members of the public here, so I'm going to move to Council Member Ortiz.

I'm quick with the button pressing.

Uh thank you so much to staff uh for your presentation.

First, I just want to acknowledge how strong uh the coordination was for that Super Bowl uh activation.

I did have the have the opportunity to visit um during uh during the time and saw a lot of people out there and join the enjoying the entertainment zone, saw you know, live music, people eating, people laughing, and you know, it really uh made uh me feel like you know, even though we are the biggest city, but uh like a real big city, and and so that's what I I like to see and and just wanted to um congratulate you all for for all the work that went in went into that and I also appreciate um this report uh emphasizing the lessons uh learned during that experience given it was our first time activating an entertainment zone so I just wanted to I wanted to just ask staff how confident they feel um from the refinements and the reposition uh uh moving forward uh for FIFA World Cup do we feel confident that we've learned from from these potential uh learning opportunities and can implement it in a more effective way we feel very confident of going into FIFA and absolutely we'll we will be you know learning and refining along the way and um we're very excited for the summer.

Great specifically about the signage and the compliance protocols as well as uh just making sure that the frontline training will be fully uh standardized and stay uh scalable are we're confident that as as we look to FIFA yes absolutely we um are working closely with um the operators themselves and helping them be more proactive in helping them we gave them some standardized documentation but now we realize that we need to be more explicit spend some more time with them so we're utilizing the business districts to kind of target and um address the concerns specific for each um entertainment zone district great thank you thank you so much um and I thank you you mentioned Alan Rock and Santa Clara Street the business association I know that the that is also another location for uh an entertainment zone here with the city of San Jose um what first off are these these entertainment zones are they gonna be online in preparation for FIFA and then also you mentioned that there's been some initial discussions regarding an activation just wanted to see I guess if you have any updates or any summary of how those conversations are going.

There are discussions about the activations for um the Ellen Rock area there's a number of proposals I don't want to get ahead of um our promotion and marketing kind of opportunities but there's a lot of excitement a lot of interest in um the World Cup uh viewing parties and how that lends itself to the natural outdoor activation this the summer I mean granted during the Super Bowl weekend we really did showcase our beautiful weather but the summer is really our time to shine and what we get to uh experience on an everyday basis in San Jose but um I will say that we are in close conversations with the San Jose Sports Authority the director's alliance um and the uh business districts um about the activations in the east side specifically on Alum Rock and how to loop in the entertainment zone.

So and then you had a second part of your question about online was that physically like on our website online or you mean like active online no I just wanted to make sure that if the entertainment zones are going to be active I guess are they going to be finished finalized?

Because I know that for San Pedro right that was like a pilot right or believe just it was the first one that was implemented and understand yeah oh was the official one so then are they all official they're all up now they're all good.

Okay so I can do an event next week and we're good.

Sure can okay.

Oh yeah yeah yeah okay all right sounds good I I appreciate that and then I know that so we had a lot of uh activations in downtown but for the FIFA World Cup there may be several activations maybe even occurring on the same day in multiple districts I know that you know uh council member Kamei has also been interested in various other council offices as well and I know that we're all working with you know the same public safety infrastructure it's kind of easy to have you know a concentration of law enforcement and support when it's in one area but now that it's gonna be potentially divided up are we having conversations with and I know SJPD is on the on the panel, but how are we prepping for potential strain on on our infrastructure?

Can I defer the uh response to our captain?

Sure.

Captain Torres.

Sure.

Sure.

Uh great question, Council member.

Thank you uh in terms of distributing the resources that we have available for PD, we have to take into consideration of the active component that we have that is working that day.

Officers that are off and we'll take an advantage of uh secondary employment opportunity and then our reserve force as well.

So we have those pool pools of officers to work with, and we have to be judicious about how we distribute each because we have to ensure that each venue has the uh safe and uh this the safe component built in with the security provided by PD.

Could there be like I don't know, I'm thinking like a cap to how many events could happen on a day just based off of existing you know infrastructure.

How are we approaching that conversation?

I guess.

Yes, council member, that is a question we ask ourselves every weekend.

We have a number of events happening citywide on any given weekend.

We activate 485 event days in a calendar year to do the math that shows uh what we have going on.

Um so yes, we uh look at the number of events is on the first-come-first-serve basis for the applications.

We do the review process, we do the it through our intake, and then we assess the safety plan within each proposal.

And with that, we work with our colleagues in our um police department, our fire department, and uh department of transportation as well to account for the safety plans.

There's uh opportunities where we can implement a combination of public uh excuse me, the police services and private security as well.

Uh so we run through that process um on a normal basis.

Um, and yes, there depending on the number of proposals we get for the um activations during FIFA, then we will have to make that decision as an organization for public safety.

Or at least um, you know, make it so that they're not on the same day or something like that.

Um, and then just in regards to to staffing, you know, being able to you know respond to that level of of support, whether it's you know, fire department, you know, police department, emergency support.

Um, are we doing an assessment of if I guess we we could we have the infrastructure to host that level of support?

Would we need to I guess look elsewhere to bring people in?

Um has there been any thoughts to that?

I'll take this one.

Um, yes, absolutely.

We are constantly assessing our staff capacity, and we know that we have when we have so many events and we have staff that maybe have other commitments or got sick, or you know, whatever that could be that prevents them from fully participating.

Uh we do know that we have a thin capacity, so that's something we're continuously looking at and ensuring that our staff and our colleagues across departments are being um you know well resourced and also you know, we want to ensure that we have a team approach that enables the staff to be supported when there are different types of events in different parts of the city, and so that those are well run and they are safe.

Great, sounds good.

Thank you so much.

Thank you, Councilmember Kamei.

Thank you so much for the report and it's very exciting.

I know I also attended uh the San Pedro Square uh festivities and and it was really really great.

Um, and I I do understand that it's an iterative process.

So as you move along and learn different things, I think that's going to be helpful for all of the entertainment zones.

I was curious in terms of, and I don't know how other areas uh have done it, but how do you delineate the entertainment zone?

Because I can imagine someone just you know, sort of going out to the to the uh sort of the plaza area where San Pedro Square is, and you know, it's not like you know, you would walk in different directions or I mean there were activities all around the block, so are you going to have some kind of delineation?

Something I mean, I was thinking, will you paint the the uh the the area around which you know it says entertainment zoners or something like that?

I have no idea, but I just I just was thinking that if I didn't know, uh, you know, like where the line stops, do you are you good because you can't have somebody like in every spot, right?

So it would be interesting to see what you come up with in terms of a delineation.

Yes.

Excellent question, uh, council member.

It seems like you're an experienced event patron.

Thank you.

Um, so yeah, so the boundaries are defined in the ordinance specifically.

So uh with that part of the requirement is that we have um signage that speaks to no alcohol beyond these points uh layered with public, excuse me, private security in addition to event ambassadors to kind of help people through that.

You know, don't or here empty your cup here, or you can continue going that way.

Uh, directing the patrons to um understand the the area of the entertainment zone.

Uh love your idea about painting and kind of really highlighting the specific entertainment zones, maybe that'll be in the next iteration of it.

But for now, the signage um is it's what goes into it along with controls from police, security, and event ambassadors to uh safeguard the boundaries.

Yeah, I think it'd be very interesting to have uh some kind of delineation that you know makes it different, uh, so that people at least will say, Oh, what's that orange thing on the ground here?

Uh as opposed to a sign, because I think signs uh while they're helpful sometimes get blown over or whatever, or people don't see them, and and it might help.

And you know, to uh council member Ortiz's question on um security.

I know that you know, in the events that I have uh been a part of, um, if you can't get secondary employment, you know, you have to do you know private security.

So I know that that's also available in terms of um what might uh help in terms of um making sure that uh you have someone there for security.

So thank you very much.

Thank you.

Councilmember Mulcahy.

Thank you.

So uh I'm gonna talk about cups.

So I apologize if I'm raising anything that was in the report that you did, but I think it's coming from the findings and conversations that you're having.

Um I know that when we first started talking about cups, uh I know the sharks, for example, use aluminum cups, and under the ordinance, I think aluminum cups are not possible for San Jose, but they're actually more recyclable than the plastic cups that we allow in San Jose.

They are also an opportunity for branding.

And to me, and I'm gonna ask Captain Torres, it would seem to me to the bordering that uh Councilmember Kameh is asking about and sort of the the sort of the branding of where you are could benefit from not only do our police officers and our security that's hired recognize the cup, like your your, you know, when you leave O'Flarities as an example, as I did with their you know, distinct glass, but then if you were at the other place down the street on San Pedro, you got a different cup.

So there was no continuity on identifying that you were, you know, a legitimately drinking a you know alcoholic beverage out in public, but then, you know, it it um gives an opportunity for us as a city perhaps to brand that cup as well, right?

Made possible by San Jose's entertainment zone type of thing, right?

So to me, it's an opportunity both to be helpful for security but also for branding and using aluminum, which we should get after and figure out how to get that changed as a more recyclable, more environmentally friendly alternative.

So Captain Torres, would it be easier for us if we had a more identifiable cup with our constituencies walking around in these entertainment zones?

Well, when I take into consideration what we um what we saw at San Pedro Square, the security was checking for open containers leaving the venue.

So that first layer exists for anything existing outside.

But in particular, if you're asking about cups in in terms of which venue it could be, yeah, absolutely.

I think officers are considerate outside of those areas.

Not first and foremost of uh what type of cup it is, it's open container, but if it were aluminum coming from that venue, perhaps it's just a redirection to that purpose by comparison to uh the plastic cups, which are more accessible to all.

So in short, outside of that area, officers are very aware of the open container, period, it becomes more beneficial for the brandy from venue to venue.

If in fact someone were to leave with one cup and then enter another cup, and then there's and there is your difference.

What I'm talking about is, you know, many times have been at a place and I'm walking out with their glass, and then they give you a cup, pour the drink in, and then you're on your way, right?

So that everybody walking around, as an example on San Pedro, everybody walking along the what is the public space.

If you've got booze in your hand, you've got it in a whatever the cup, whatever we decide.

But everybody's got the same cup.

What I experienced is um I didn't have that easily distinguishable that I was carrying alcohol around.

I got to a non-sworn security officer at Santa Clara Street, and not only was it sort of like, you know, she was trying her best, and she was super polite, trying to kind of keep control of people leaving uh San Pedro, but it wasn't automatic that somebody was carrying booze in their hands.

The other thing that I also recognize is there were no garbage cans.

There were cups everywhere, right?

So I think if we're gonna do this from the standpoint of to Councilmember Kamei's point, of like having these zones where you're sort of coming in and out of these districts, we have to coordinate them in a way that we're not just you know making it easier for whoever's controlling that gateway to recognize where the booze is, but also if somebody you know just has to leave like I did, they asked me just to set it right on the the K-Rail that was sitting right there.

So just a couple of things to think about relative to that.

Um so we're open to aluminum, right?

You guys were thinking about that.

Well, council member, we love that idea to that point of environmentally more friendly um for recycling.

However, it is prescribed in the state legislation, no glass or aluminum cups.

So, unless that changes on that level, we'd have to think of alternatives on our side, but agree to all of the other points in the perspective of you know being more environmentally friendly with our use of uh disposable products.

Can we refer that to our legislative people?

Yes, can we?

Rosalind's saying yes.

Can I do that right here from this dais?

Thank you, Council.

No, I don't think you can.

No, actually you can, but that's something that certainly staffed in terms of us doing an evaluation of the entertainment zone activation is something that we can certainly recommend to our IGR team.

Sounds like a memo, baby.

All right, with that, I'll move to accept the report.

Great, thank you.

Thank you.

We have a motion and a second, let's vote.

Thank you.

Looking forward to aluminum basket.

I was gonna say basketball and then soccer and then crossfit.

Okay, I guess CrossFit doesn't count.

Okay, Carlos.

We now have the uh economic development activity semi-annual report, and I understand, Carlos, this is your last presentation to us that you're moving to another department within the city.

Congratulations to you.

But we will miss you.

Thank you.

Thank you all.

Uh greetings.

Uh, thank you for Vice Mayor for acknowledging that.

Uh my name is Carlos Velasquez.

I'm the public, I'm still the public information manager for the Office of Economic Development and Cultural Affairs, and proud to be that for the next couple weeks.

Uh, today I'll be sharing uh our office's notable accomplishments, announcements, and events since October 2025, which is our last activities report to this committee.

So, as you just heard from Carrie and Melina, our cultural affairs team has played a major role uh in activating San Jose, played a major role in activating San Jose during Super Bowl weekend.

In January, the cultural Affairs team launched Hometown heroes here at City Hall, a three-part exhibition featuring murals and photographs by local artists and historic images relating to celebrating San Jose's sports culture and community.

The exhibition will remain on view through July 31st.

We also helped produce Invisible Skies in January, an immersive pop-up flash performance that brought nearly 2,000 residents together to create a living artwork using custom umbrellas and spontaneous movement.

Though the event was temporary, the project continues through new mural and video installations now showing at San Jose Meneta International Airport and with more locations planned as well.

Our special events team also supported the major concerts and block parties throughout Super Bowl week, helping organizers coordinate the city services to ensure events ran safely and smoothly for nearly half a million visitors.

In November, we announced the city's 2026 creative ambassadors, who you can see on this slide.

Each ambassador will be leading a project that invites creative participation that celebrates the diversity of San Jose's cultural communities.

Projects are already underway, including an interactive poetry and storytelling workshop this Thursday with Ambassador Trisha Crees and Valencia in partnership with the Reals and Records exhibition in downtown.

Our downtown team also played a key role along with the San Jose Downtown Association and partners on placemaking improvements leading up to the Super Bowl.

One example is the Stitching Districts Initiative, where 100 swimming sharks are being installed along Sharks Way.

With support from the Sharks and San Jose State University, the plans are to make the sharks interactive.

Visitors will be able to scan them with their phone to access maps, restaurant recommendations, and public art highlights.

This enhanced wayfinding will also support major upcoming events, including Nvidia's GTC conference in March.

Our downtown team has been working across departments with NVIDIA to plan this year's conference, which is expected to draw 30,000 attendees, up from 25,000 last year, with expanded activations at Arena Green, the convention center, Plaza de Cesar Chavez, and surrounding areas.

We also continue welcoming new businesses downtown through several recent ribbon cuttings.

You can now enjoy Pupusas in downtown thanks to Entre Comales on Third Street off San Carlos.

Guitar Wars opened in the Sofa District, where I learned that SJ Sharky plays a meme drums and guitar.

The locker room visitor center on Third and San Carlos offers San Jose branded merchandise and visitor information.

And ToStiq opened its first location in the South Bay to long lines out the door at their space on the corner of Santa Clara Street and San Pedro.

Our office continues to provide grants and resources that support neighborhood economic development and help small businesses grow and succeed.

Along with our other Super Bowl related support, our office spent the past few months gathering and promoting resources to help small business owners prepare for hosting and watching hosting watch parties and special events.

We created an online toolkit for the SJ26 website, and in December, we partnered with Councilmember Ortiz to host a town hall at the Mexican Heritage Plaza to highlight the resources in that toolkit.

The event was attended by more than 150 people with Spanish and Vietnamese interpretation available.

We also continue advancing efforts to strengthen business districts, working with local associations to establish business improvement districts along Story Road, East Village, and the Alum Rock Santa Clara Corridors.

In January, we launched the small business startup grant program developed with the city's small business advisory committee.

The program offers grants of up to $10,000 to support licensing, equipment, hiring, or loan-down payments.

Interest has been very strong, and applications remain open through March 6, with weekly multilingual drop-in support available at City Hall.

Our cannabis equity business program has been a no cost entrepreneurship training program for those disproportionately affected by historical cannabis laws.

Of the 29 participants who completed the program last year, 10 were selected to open businesses, and eight have already secured commercial leases in San Jose, including one now open.

This quality entrepreneurship program speaks to the city's commitment to equity and improving the quality of life for all our residents.

And during the holidays, our Shop Local campaign, an annual collaboration with Team San Jose and local business associations, attracted more than 23,000 visits to the Shop Local page, a 15% increase over last year, highlighting over 300 businesses across 13 neighborhoods.

Our corporate outreach team continues building strong business relationships that support one of the city's key goals, growing jobs and revenue.

In January, alongside Equinix and PGE, we celebrated the energization of Equinix's S V 12 data center in the Edenville area, the first facility to receive power under the city's new agreement with PGE.

In addition to supporting the region's innovation economy, projects like this generate meaningful revenue for San Jose.

Once fully operational, Equinix's SV 12 is estimated to bring in about $2.5 million annually in utility tax revenue, supporting essential services like public safety, libraries, parks, and infrastructure.

Our team also continues connecting with companies through industry meetings, conferences, and business outreach like those you can see on the slide to celebrate and attract business to San Jose.

We're also seeing strong momentum around the city's foreign trade zone program, which helps companies reduce costs on imported goods and encourages local manufacturing and trade.

We recently welcome Newark's Unigen Corporation to the program, bringing participation to 11 companies with seven more applications currently pending.

Our goal is to double participation by the end of next fiscal year, and we're well on track of meeting this goal.

Every two weeks, including today, we share on our social media a calendar of upcoming workshops hosted by the city or our partners, as well as a monthly email to our list of small businesses.

You can see on the slide a few that are hosted by our partners.

We'll be sharing this week with your offices about more information about these workshops and other workshops happening in the month of March for you to share on your social media and your e-newsletters.

You can also find us at SJ Economy on all platforms.

And finally, in the last three months, we welcome three new members to the team.

Emily Lamb is the newest member of our small business outreach team, helping lead our efforts to support small businesses and neighborhoods.

Dolores Estrada will support major real estate projects in the Deredon and downtown areas, as well as oversee the community stabilization and opportunities pathway fund commission.

And Jen Lavorne is our new public art director, working with staff and the community to realize the vision for public art in San Jose.

Their collective experience, energy, and leadership will help advance the office and city's long term goal of cultivating an ecosystem of thriving businesses and arts.

This concludes our report.

Where are you going?

I'm going to be joining the environmental services department as the public information manager.

Oh, very good.

That sounds like a lot more work.

High reward, I'm sure.

Uh, seeing no hands raised, there's uh we just uh there's no motion on this, I believe, or do we accept this report?

I forget.

We accept the report.

So I would say about the report.

Okay, then let's vote.

That motion passes unanimously.

Thank you.

You did an excellent job on your final report.

Thank you so much, Vice Mayor.

I just want to say thank you.

You've always been very good about connecting with the offices, um, especially my office.

I I have a lot of questions, and I just want to say thank you so much.

Great, thank you.

I don't see any public comments here, so so concludes this version of the CED meeting.

See you in two months.