Well, well, I don't know.

Well, I don't know.

Well, I'll tell you.

Good evening, everyone.

Thank you, and welcome to our special meetings.

My name is Lisa Bickford.

I'm the vice chair of the planning commission.

I already said welcome.

Please remember to turn off your cell phones.

And if you could please, when you're speaking, pull the mic close to you so that uh it can be transcribed properly.

I'd like to do roll call this evening.

I'll start with the planning commission.

Uh the Chair Rosario is not here yet.

Hopefully, he will be here with us shortly.

Um Barrosio.

Commissioner Bandal.

Here.

Welcome.

Commissioner Cantrell.

Commissioner Cow.

Commissioner Casey.

Here.

Commissioner Escobar?

Here.

Commissioner Newen?

Yeah.

Commissioner Oliverio.

I thought I saw him.

And Commissioner Young.

Thank you.

I'd like to also uh check in the Housing Commission members.

Chair Navarro is apparently not here yet.

Commissioner Buckholz.

Here.

Commissioner Critella?

Am I saying that right?

Yes.

Commissioner Escher.

Commissioner Finn.

Here.

Commissioner Wong.

Commissioner Jazinski.

Commissioner Mock?

Here.

Commissioner Moore.

Commissioner Moward.

Commissioner Moya.

Is that one?

Yes.

Moad?

Yes.

Sorry.

It says MOARD here on my piece of paper.

I apologize.

Commissioner Salazar.

Commissioner Sapirman.

And Commissioner Carroz Medrano.

Thank you very much.

Did you note that Commissioner Mock was here?

Because I didn't hear.

I am here.

Commissioner Mock is here.

Thank you.

Okay.

So we are calling this special meeting and study session to order.

Do we need to do the pledge here?

Do we have a flag?

No flag.

Okay.

All right.

So we're here for the housing element annual progress report and housing catalyst team work plan.

The presentation on the 2025 Housing Element Annual Progress Report and the Housing Catalyst team work plan.

This annual report provides updated information on the progress on the sixth cycle housing element, housing production towards our regional housing needs allocation, and progress on the programs outlined in chapter three of the housing element.

And who am I handing off to?

Thank you.

So this is the first time where we're trying this.

Typically, we have brought this item kind of separate individually to both commissions.

So we thought this year we would try uh having this joint meeting, and as a as a new way to sort of you know inform both commissions and have a discussion.

So we will be talking to you tonight as as noted about our housing catalyst teamwork plan or in an annual progress report on our on our sixth cycle housing element.

Sorry, let me get these to work.

Okay, so just first some some background.

Um, some of you may be aware, but I know there are new uh members, I think on both commissions.

Um, so our housing catalyst team dates back really to 2018 as the city started to really put a focus on our housing crisis and start to think about how we could be more proactive and and really work collaboratively across across city departments on the complex policy issues of housing.

And so we formed this this team, which is composed of staff from planning building and code enforcement, our housing department, our department of uh our office of economic development and cultural affairs, our department of parks recreation, neighborhood services, as well as our other uh key staff members in the city manager's office and others, and really to kind of collaborate and and work um on the complex issues uh you know we we face in the city.

And so that was um started in our last housing element cycle, and so as we we started to prepare our six-cycle housing element, we wanted to continue that work and really that that synergy that we had formed through that team, and so um we built in a lot of the elements of our previous housing crisis work plan into the new housing element, six-cycle housing element.

And so when the housing element was adopted by city council in June of 2023, we also established and created the first housing catalyst team work plan as a part of that.

It was really meant to sort of highlight the the key work that we were doing for the housing element and other housing items as a way to show what's being worked on actively or what we're about to start since the housing element itself stretches eight years, um really what's in the next year and the current year, what we're working on.

So we had the adopted housing element of June of 2023.

Um we looked to January of 2024 certification from the state of our six-cycle housing element, and so the the last two years we've had these annual status reports on the housing catalyst work plan to both commissions um as well as the city council's committee on economic development.

Um, and then it follows in March with a report on our housing element progress report, and then that progress report is due every April 1st to state HCD.

So, to kind of take you through where we're at in terms of our regional housing needs allocation progress, and this is really um tracking kind of the actual housing production in our housing element arena cycle, our sixth cycle.

So it's tracked by calendar year.

So, as a reminder, there are eight years in in the planning cycle in the sixth cycle.

So this spans from 2023 to 2031.

So we're in the third year now.

Um, and so uh units are tracked when building permits are issued.

So that's typically when construction starts on new housing units, and when we kind of get credit against what our goals are.

So we're assigned a goal over that eight-year period, a total number of units.

Um, the city was assigned sixty-two thousand two hundred um over that period, broken into these um four categories: very low income, low income, moderate income, and above moderate income housing.

So this is looking at the calendar year goal.

So the bars in orange are the kind of the one-eighth total of that 62,000 number, what we should ideally be achieving in one year to achieve the total eight-year goal.

And then the bars in blue are the numbers, the actual numbers we saw in the last calendar year produced in terms of number of units permitted.

Um, so you can see there how our performance was.

Something to note so the very low and low income, those are the restricted units, the affordable units that are restricted, moderate and above moderate are non-restricted units.

Um, kind of given where the rents were and the methodology given to us by the state, a lot of the units that are market rate units were able to be counted in the moderate income category this year.

So that's why you see that blue bar, you know, pretty significant through some of the programs we will talk about have been successful, and seeing some projects move forward in the last calendar year.

Obviously, not where ideally we want to be, but you know, continue to try to do everything we can to try to make make progress.

And so the next slide here, this shows our overall progress.

So from 2023 until the present, so the three-year progress.

Again, the orange bars are sort of the overall goal.

So you can see the 62,200 number there and the 200, that's our total arena allocation.

And then the blue bars there, what we've actually performed in the sixth cycle.

So just kind of comparing ourselves to other large jurisdictions across the state, taking a look at 2023 and 2024, since we don't have their 2025 data yet, but looking how progress has been made across the state.

We're um no city is performing where they should be or where the expectations were, even accounting for where various cities are at in their arena progress since the sixth cycle starts at different uh times based upon what region of the state you're in.

Kind of looking at our regional peers, you know, San Francisco and Oakland, we are somewhat ahead of those, but those cities within our region are still behind other regions of the city in terms of of volume of performance.

So getting into some of the actual policy work items and our housing catalyst work plan, highlighting some work items that we've completed in the last calendar year, and so just to orient you on how these are referenced as well, the letter and number in parentheses you see here that's referring to the letter and number of the program in the housing element.

So uh item P11 was allowing additional types of housing or SB9 type housing in other areas where SP9 didn't allow that type of housing, so in historic areas and in our R2 zoning, that's what the emphasis of this work was on.

Um, and then another work item P42, and this was uh making some zoning ordinance changes around group homes for seven or more in single family neighborhoods.

Kind of a very technical one, but an important program in our housing element.

These were both completed in January, so just a month ago, the final approval by city council was done, and this uh these zoning changes did go through planning commission as well.

So you you heard this earlier, I think in December or November.

Um, and then additionally, P15, our moderate income housing strategy was adopted by the city, the city uh council community economic development committee in May of last year.

So getting into some highlights about what work we've we worked on last year and continue to work on this year.

Obviously, a big emphasis as as many of you are well aware for for planning around housing element and housing catalyst work plan is our general plan for year review, and the goals of that are really to advance uh key policy programs in our sixth cycle housing element and to prepare ourselves for anticipating the seventh cycle housing element and that work that'll have to be completed by January of 2031, that new housing element document.

So some of the big work items contained in the sixth-cycle housing element that are part of our housing catalyst work plan are P35, our small multifamily housing program.

Um so this is looking at allowing potentially four to ten units in lower density areas of the city that do not currently allow that type of housing.

Additionally, P40 evaluating our urban village planning process.

So this is looking at ways to streamline uh our urban village planning process to potentially unlock more sites for housing that that don't currently allow it.

And as the task force and planning commission is aware, these are items that we have discussed or will be discussing for small multifamily.

In fact, this will be the topic of our discussion at the next task force meeting next Wednesday.

So these are all programs that we're actively working on through this four-year review process that are embedded in our housing element that are kind of crucial to the policies and strategies we committed to in that housing element.

And the general plan task force is started meeting in last or last October, and we'll complete that work by June of 2026.

So going into some of the more specific programs, when the state approved our housing element in January of 2024, you know, there was a hundred and thirty programs and strategies in that, but in the letter that they certified our housing element, they specified some specific programs that they would be monitoring for compliance as we did our annual progress reports.

And so this is a list of those programs that were named explicitly in that letter.

So the first two are City Infill Housing Ministerial Approval Ordinance or P7.

That was completed I think the December before last, and that provides a new streamline approval pathway for housing in our urban village growth areas.

Um was one that they mentioned that was completed previously.

P4, this is around providing additional affordable housing tools for North San Jose, kind of beyond what we've already done there in terms of the overlays where we allow new new, we found new sites to allow for mixed income housing projects and low income housing.

We've done some evaluation of this, and I think our our can our conclusion at this point is that based on kind of the economic factors, it doesn't really make sense or the other tools would not be successful in sort of spurring more affordable housing there in the present environment, but something that we want to continue to evaluate based upon annual cost of development report.

P9 is around encouraging uh affordable housing production in the Deirdon station area.

Um that continues to be an ongoing effort through through various programs and policies.

Um we talked about our small multifamily housing program.

That was one that they they specifically identified and mentioned, and then also as I just talked about our evaluation of our urban village planning process.

And then the last one, um, P41 is somewhat technical but important, is revising our planning uh permit conditions to make sure that they comply fully with state law around um objectivity.

And so uh we anticipate completing that by the fall of this year that will be coming through through planning commission as well since it will involve changes to the zoning ordinance.

And I will pass it to uh Sarah now to.

So uh good evening commissioners.

My name is Sarah Fields.

Thank you, Jared.

Um I serve as one of three deputy directors of the housing department and work with our housing and community development commission.

Um so to continue forward, um, this is a look at at market conditions and frankly the need for incentive programs because of those conditions.

So, this is probably obvious to most of you, but just to level set uh the the housing market remains very high priced and competitive.

Um recently we have seen moderate and I really want to stress the word moderate price softening after several years of rapid growth.

Um that being said, affordability challenges persist amid high baseline prices and continued limited inventory, of course, which we are trying to uh increase inventory uh through this process, but nonetheless, limited inventory, continues, uh, which is in part two to the high cost of development.

Um you all are invited to uh review.

We did a cost of development, cost of residential development, I should say, study uh session with the city council in December of last year that really dives into uh some of the challenges there.

All of that being said, there are two programs that have just been extended by our city council as of January 27th.

Both of these programs are intended to encourage development despite these challenges, through the lowering, reducing, I should say, or elimination of certain fees and taxes for development.

The multifamily housing incentive program targets particular areas across the entirety of the city.

And then the downtown residential incentive program, as the name obviously implies, is focused on the downtown, and also now includes, in addition to new construction, also includes the conversion of office buildings into housing.

If any of you have looked outside in our downtown lately and noticed the scaffolding on the Bank of Italy building, that is our prime example of office to housing conversion.

So next, this is a fairly useful but complicated, so I'll walk you through it.

To orient a little bit, the blue is for the city service area around neighborhood services and education, and the orange is around community and economic development within that service area.

So on the far right, you see home ownership as sort of the high end of the housing continuum, and then sort of working your way towards the left, subsidized homeownership, and then market rate rental units, then rent stabilized units like for from the apartment rent ordinance units, then rent stabilized and restricted, so deed restricted, and then you get into permanent supportive housing units.

Then you see kind of within this framework here, these are really all of the different kinds of shelter and supportive units that are for people experiencing homelessness within our city.

And then we see certain elements that are city focused and certain elements that are that are county provided.

So you see interim housing units that are temporary, then boarding care that's county, congregant shelter that's also county, safe sleeping and safe parking sites, and then the motel-based programs all within that sort of section around homeless services within the city and the county.

And then to the left of that, we see this would be an unsheltered homelessness, encampment resolution, individuals living in vehicles, outreach, and then at the far left, sort of its own other section, which is preservation of units and prevention of homelessness from the start.

So you were back to the sort of interesting numbering and lettering system of our housing element.

So these are the key areas around preservation and anti-displacement.

First, preservation and community development capacity building, so really working to make sure that city staff and contracted neighborhood organizations and community organizations are able to really serve the needs around community development and preservation, preservation from keeping people in their homes to making sure that naturally occurring affordable and deed-restricted affordable units are remaining safe to inhabit and live in, and that gets us to our next bullet point preservation, the preservation NOFA, then the notice of funding availability, so funding unit preservation, to make sure that those units stay habitable, which is also leads us to a more specific program, which is the soft story program.

On January 27th, it was a big day, it was housing day, at the city council.

Our council approved 1.6 million dollars for an initial soft-story investment.

And we recently also got a congressional earmark of another $2 million from Congressmember Licardo for soft story.

So soft story is essentially small multifamily buildings that have what look like carports on their first floor.

Those need retrofitting to withstand earthquakes.

Prior to the building code changes in the early 1990s, these were not built to withstand earthquakes.

Now they are, but most of the buildings in question here were built in the uh in the 1960s, 1970s.

Um so there they do require this retrofitting, and that's something we're starting to address more and more.

Eviction prevention activities through our rent stabilization program.

Um we offer a variety of education and services both to uh landlords and tenants around eviction prevention as well as um going to court when an um uh a lawful uh an eviction is uh going through the legal process.

Um we've established the tenant preference ordinance and um the which helps to select tenants for um for new construction um with a local preference, a local preference uh defined by uh council district, um so just the three newly added items to uh to reference the inclusionary housing ordinance um was updated by the city council again on January 27th.

Um there was several amendments, uh several changes made to the inclusionary housing ordinance, but just to um briefly orient the group.

Um, inclusionary housing is um the inclusion of uh deed restricted affordable housing within market rate development.

Um it generally includes about 15 percent.

Um there's a variety of different ways to get towards compliance.

I think the last time I asked staff, it was 12 or 13 different pathways to compliance.

So um I'm not going to get into each one, but um generally it's um it's building on site.

Um, there's an option to build off-site or to pay in loo fees, but um it's really our strong preference to get the units built and to get them built on site.

So we've we've tried to encourage that in the new ordinance.

Um, second was the mobile home rent ordinance.

It came before council on January 27th.

Um there was an adoption of state laws to uh well, the acceptance of course of state laws and the alignment of the mobile home rent ordinance with state law and the direction for staff to return towards the end of this calendar year after extensive community outreach with program updates on the mobile home rent ordinance, so stay tuned for that.

And then uh third and lastly, linking land to capital.

So there are uh currently uh just under 32,000 units that are entitled in the city of San Jose, and we have done uh a feasibility analysis on those units and determined um roughly a third of them are are financially feasible at this time.

Um and that's based again on the uh cost of development study that was done in December, and looking for further analysis there.

So there'll be more information around looking at feasibility and and really what's possible to get built at this time and uh so you'll be able to see that report in the coming months.

I see a question.

Um, why don't we take questions when I conclude?

Unless it was it a specific question about this slide.

There's just two more slides.

Very good.

Okay.

So next steps in, let's see, exactly in just under a month from today, the city council will be hearing these items.

And on an ongoing matter, of course, is the updates to the housing catalyst uh teamwork plan, um, which you can find on the dashboard that uh planning building and code enforcement uh keeps on their website.

And I believe with that, we can take questions.

Is this okay?

It is on.

They're always on, yeah.

Thank you.

Um two questions, but they're really the same question.

Uh on slide eight, we talk about the affordable housing tool, which is based on the annual cost of development survey.

Yeah.

Um I'm just wondering, how useful are you finding that um study for housing development?

I would I mean uh defer to housing as well, but I think we find it very useful to sort of have kind of an overall temperature check of of where kind of the status of the market is to understand what things might move or not move if we make any policy changes versus what's kind of outside our control that we don't have influence on.

Um so in in this case on on this program, it kind of contemplates, you know, looking at could we have a modified sort of density bonus program to encourage more affordable development?

But where kind of the existing condition is uh more density isn't gonna help projects you know pencil out.

So it's not gonna be a tool that's effective right now.

So it it in that sense it's helpful informing this policy work and then at a global perspective helps us sort of tailor to figure out are there changes we could make that could help move, you know, um to anticipate to try to create more housing production.

Okay, because how many two-acre rectangular lots exist in district six or in North San Jose, I'm sorry.

Yeah, not there's not many in North San Jose.

So how's that study useful?

Well, I I you you can't study every scenario, you know, in a hypothetical.

So why pick that scenario?

Well, I think there are I mean, I think it represents, it's hard to represent every model.

I mean you could you could study a lot of different, you know, is it four acres, is it ten acres?

I I think you have to pick you have to pick some models, and I I don't think it's an unreasonable assumption that you'd have a site of of two acres um to develop on.

But we don't in North San Jose, you mean?

Yeah.

Well again, it's we got a big city, you know.

I I understand what you're saying.

I did it's hard to, you know, you can yeah, it's hard to look at that many prototypes and trying to limit the number of read the report, and I didn't see a lot of usefulness to be quite honest with you.

Um that may just be me.

I don't know, but it just it doesn't it didn't seem to represent most of San Jose and for that reason alone.

I don't know how useful that can be in making some pretty important decisions.

Um the same question actually goes to uh the land linkage um entitlement and feasibility analysis.

If you're using that report for feasibility analysis as some torto some sort of linchpin, I'm just not sure how accurate you're gonna get anything out of that.

I I don't know.

It's I think it's a big question.

So I guess that's true.

Yeah, Commissioner Catrell, um uh can you sort of explain a little bit more about what you don't think is uh working in terms of the cost of development study.

Well, I don't I don't think it's based on it it's based on a unicorn.

Um the two-acre rectangular site um with what it any type of density is just not how's the cost of study based on something that rarely exists.

Sure.

But it does also look at a variety of different scenarios, different building types.

But based on the same foundation.

Is land cost not a part of the formula?

No.

So you don't even consider the costs.

So you look at residual land value, so it uh whatever the remainder is is what can be paid for land.

So the land value cost isn't factored into the analysis.

So only the factor is a two-acre rectangular site.

Well, I think the challenge is is you can't there are assumptions that you have to make when you're doing a hypothetical analysis.

Because we we don't we don't have an actual specific project in their performance, you know, specific details of the project, and and absent that I think you have to make some assumptions and it's hard to pick you know a perfect model that's gonna model every scenario.

So you have to sort of hone in and take what what is an average.

I completely agree with you on that point, but pick one that works for the predominant of available properties which would dictate the density, which would dictate the cost of development.

Yeah.

Well, I would I would just say too, I mean, I I think what what we could what's also useful to look at is is what what's actually occurring too.

And like so we we have the analysis that we've done in in you know the the hypothetical situation, and then we have real projects, right?

And you know, we've seen through our production that there are challenges, right?

And I think we've been at least somewhat successful.

We had you know four projects utilizing our our incentive programs, you know, that move forward, um, which in the year before last we we had very few um you know kind of market rate unsubsidized projects move forward.

Um but so that's the market telling us that what our study says is sort of you know true in terms of what we're seeing actually occur, right?

So in that sense it is another check on on what what our report says, right?

Of like what's actually occurring and what we're seeing happening in in the real market.

Okay, all right.

I I'll I'll accept that you it's useful in some way.

I just don't think apples and oranges generally get selected at the same time.

And I I think that's what we're doing.

We're we're trying to create from a standard that doesn't actually exist.

That that's that's my belief.

Maybe I'm do you have a suggestion of a different or better model?

Because there would need to be a model that we use, and so uh I'm I'm curious what that model might be.

So it's a basket of goods model, and it's looking at multiple configurations and doing analysis on those configurations and determine by waiting which is most likely in whatever circumstance.

I don't think I don't think that study was adequate to be quite frank with you, uh, because it only shows it illustrates one potential model, if that's what a model is.

That's how they modeled it, and it it doesn't explore most of the city.

That model doesn't apply to most of the city.

Um so I just think it's inadequate.

And I I don't know how much how many decisions you can make from that.

I I don't know how sound the thinking is.

That's that's my question.

Uh I I think there's no way to perfectly model a study that's gonna show you what every project's going to look like, but I but I think looking at at hypothetical projects, prototypical projects that that you know aren't a aren't a perfect carbon copy of what we're seeing, but do approximate what we're seeing, I think is is reasonable to to look at a city city, especially a city of San Jose size and looking at different areas of the city because it does look at different areas of the city.

Um I think it's as close as we're gonna get to uh a decent picture of of what the snapshot is without doing very robust modeling that's centered on specific projects and sites.

Okay.

Yeah.

As well as our nonprofit partners.

Sure.

Do you have a specific federal cut in mind?

Or I'm and I'm sorry that I have to ask that.

I I don't.

I just, you know, the you hear a lot of talk about HUD being cut, and then so yeah.

So uh it's a fair question.

Um the answer sort of broadly is we hear a lot of noise, we get a lot of direction.

Usually then there's some level of litigation, and then there's clarification.

An example of that is on the homelessness side.

Um HUD had changed several requirements sort of halfway through the cycle.

Um, we saw a change in application, then a rescinding of that application, and now we're waiting for more.

On this side, um, the funding stream for our NOFAs is through loan repayment.

So that doesn't that is not impacted by federal dollars.

Um that these are local funds.

Um for some of our community development block grant funding, C D BG, there was a delay in receiving those funds, and that did have an impact on some of on legal services that um that do some of our eviction prevention work.

Um those funds are now in place.

Um I I can't predict the future, but it is possible that that those kinds of um delays could happen again.

Um but thus far there have been delays, lawsuits, and then the restoration of those funds.

Um, I think some of the bigger challenge here in terms of meeting our arena is about the cost of development, and that we're looking to really for decades we were not building at a pace that was the answer to to solve to to the housing needs of of these communities, and this is a statewide challenge.

And so now with these RENA numbers, they're very high, and they're trying to make up for those decades of development not keeping pace.

Um, and you know, in in Jared's presentation when we looked at slide number five, um, you can see that our uh fellow cities are also having challenges here in in keeping pace, and it's it's useful to remind everyone that cities are not developers.

We don't build the housing, we create the conditions for the housing, and um we are trying to create more and better conditions to for that development.

Um I think that's why our numbers a hint better than our neighbors, but but still challenged.

Um so the the federal piece is not as much of a factor um when it comes to development.

It is a factor around tax credits, but um there's actually quite a bit of bipartisan support around low-income housing tax credits, um, and so that we're still seeing that kind of affordable housing, the the uh low and extremely low-income um support on the federal level.

That's great to hear.

Thank you.

So I'd like to ask a couple questions here.

And so when it comes into the affordable housing tool, you know, why was only North San Jose chosen for this study?

And I just I say I asked that just because I know there's some properties that are empty lots on Monterey, for example.

There's also some empty lots in South San Jose.

So we're we're we would like to see affordable housing in all parts of the city.

The reason that there's some emphasis placed on North San Jose is is sort of a historical lack of production in North San Jose.

Um, so historically, it's been a predominantly um industrial employment area of the city.

Going back to 2007, um, even a little bit before and into 2010, the city you know looked at a comprehensive update of planning efforts there, um, and did add, you know, capacity for 32,000 units in North San Jose.

Um, a lot of the capacity and some of the initial phases got built in 2012, 2013, 2014.

And at that time, there was a goal that 20% of those units should be affordable.

But because of the way that policies came out and because of their other factors, only three, two hundred or how many is do you know, Ruth?

Isn't that just the first?

Oh, eight thousand was the first, but how many out of that eight thousand were affordable?

I think it was several hundred.

So when we look to, you know, increase opportunity for housing in North San Jose, one of the directives was to look at ways that we could also add more affordable housing to help make up for kind of the deficiencies of in the past of where we didn't meet the goals that we had set.

And follow up, it would be helpful to have like a summary or a memo around some of these topics to actually review as you follow through.

I feel like this is a little too high level without some of those details for us to fully understand those implications or the studies that you were mentioning.

And but my other question around is when you're thinking about, you know, going back to what Chuck was mentioning.

Do we have a standard idea of what kind of developments we're looking at, or we're also being creative in the idea of creating different types of housing or affordable housing that look different that do accommodate the space because I'm sure not all of them just fit one size fits all.

Yeah, so the cost of development study looked at more more typical development types, so townhomes, stack flats, a podium style, a wrap style, and a high rise.

Um it's harder to model those newer types of of affordable or or not affordable housing types.

Um we have a number of programs kind of looking at ways in which we could be, you know, sort of more creative um in how we might we might have affordable housing, but it's harder to model in that cost study.

Um, but from a policy perspective, there are sort of areas where we're pursuing policies and in terms of trying new things.

Um I think the the small multifamily um proposal program is looking at how you know how do we do you know smaller types of of multifamily housing in areas and in ways we haven't seen in the past, and so um I think it's really an all of all of the above type of approach in terms of policy, but from more of that study analysis, we're looking at more more traditional because that's where we have the data in order to produce that type of report.

Can you clarify why we're not looking at the acquisition costs in those analyses?

So typically when when, and this is really modeled off of how you know folks in real estate would look at new development, um, first you want to look at all your other costs in in land cost, and then that tells you how much you can pay for land.

So when you do a residual land study or analysis, the remainder is what you can pay for the land and what and that's what you take to negotiate in terms of purchasing property.

So it's not that it's not sort of factored in, it's just how you understand feasibility is done within that model.

Well it makes sense if you already have the model.

I'm sure you you had the residual after that model.

So it gives you like a baseline of what you have left over to work with.

And then I'm sure you know, looking at pro forma myself that you start comparing and contrasting different models to understand what you can create an average at that point.

Of land costs that you could pay that you would want to pay for that land.

Because I do know that public money is you know, it's tight, so there's only a certain amount of cost that you can pay for that.

It's not that's the same as the speculative market price.

Sorry, could you clarify your question?

Um, no, it was just a statement.

But my other question is are we looking at uh models like uh cooperatives limited equity housing co-ops like community collectively own options around home ownership instead of just building rental units, given the fact that rental units and we all know that affordable housing is not affordable at the end of the day, and so offering the opportunity to actually own instead of just renting this whole cycle because no one has something to show for it when they rent for 20 years, yeah, that's certainly something that's uh being explored.

Um I will say though it's affordable homeownership has been a consistent challenge um in terms of frankly working with developers um to to make that work.

Um generally with affordable projects when um they're um they're almost always rental.

Um it's it's how they pencil um but it's certainly something that we would like to look into and and explore more.

Um if you all saw earlier today the Silicon Valley uh index for this year came out um that showed that first-time home ownership is down significantly in this area, and um you know that's that's within market rate, and that's uh you know an ongoing challenge that we're we're seeing in the region.

Um the South Bay Community Land Trust has um has a project with with the housing department um and that's certainly an uh a model that um you know if if that project uh is successful um that could be further explored.

Yeah, and uh my last question here, more of a statement actually, is I know that uh New York actually has a department that supports uh the creation of community owned or collectively owned uh cooperative housing, and so they offer technical assistance, also offer financial support.

So that seems that's something that uh we should explore some more.

And I'm sure that you know, as a commissioner, I can give you all suggestions and we'll shoot over any reports that can actually support that.

Um but actually just thought of another question.

So when we're thinking about SB9 and we're thinking about single-family homes, like in order for us to do that, like is there a study that also included in the North San Jose study is the conversion of single family homes using SB9?

So Jared can tell you what we we've very little participation in SB9.

Um, what is the permitting?

It's so um that small multifamily program is really looking at ways in which the city could kind of expand upon what SB9 does and what other state law does, such as SB1123, and allowing, like I said, up four to ten units on property such as single family um throughout throughout the city, potentially.

So it's it's that that sort of is our effort in terms of looking at how we we could expand or create policies to sort of um continue to see growth in that SP9.

But as Sarah's suggesting, you know, um the number of of units that we've seen from that so far has has been somewhat limited.

So it was SB 11 or SB 1123 is uh is another um law that took effect in July, and um it allows up to 10 units on vacant or uninhabitable single family um lots um or multifamily lots.

Um and so through some of those changes that that that does create another sort of pathway for folks to develop on on single family.

But I will remind everyone looking at the cost of development.

Even with even with a small multifamily, it could be very expensive.

You would need the the startup cost to get there.

Um so we're seeing a few dozen applications um you know citywide.

You know, just some last thought on that um is more around scattered site projects.

You know, that's something that other cities here, you know, EPA is actually doing that.

EPA can do they're looking at scattered site projects, so that may be something that we can explore some more.

I have a question.

Uh hey Jared.

Uh page eight, uh, last bulletin point.

Uh it says to review, revise planning permit conditions um anticipated by fall 2026.

Um just kind of can you just kind of quickly talk about that?

Uh I know you you mentioned earlier, but some more.

Sure.

It it's it's a somewhat technical program in our in our housing element, but there um is is some language, particularly on permit findings.

So the way that state law has evolved as as I'm sure many of you are aware, um, any of our um uh requirements or or findings around housing have to be objective.

They can't um be subjective in any way.

Um, there's some language in our in our zoning ordinance that needs to be to be modified to reflect um the objective requirements of state law, and so that's what this program aims to fix.

Um, you know, it's not something that we're enforcing because of of state law, but we need to sort of clean up in our zoning ordinance.

So that's that's the um effect of that program.

Um so it's something we'll be like I said, talking to Planning Commission more about when we when we kind of bring those changes forward and in terms of what the specific details are, but it's just highlighted here because it was an important program that the state highlighted for us to complete, and so we we're you know we're working through that right now.

And then do you think the net effect would be to it'll speed it up or slow it down or we stay the same?

The permitting classes?

It's it's it's a somewhat neutral program.

It's really to make sure that we're we're complying with with the rules and and the state law.

Okay, and then I got one for uh Sarah.

Um you briefly mentioned um the office to residential conversion.

Um when was that passed?

Was that last year?

I believe, right?

No, it was January 27th, 2026.

Um it was just added into the downtown residential incentive program.

So included within that program now is also um uh the office to residential conversion in the the downtown corridor.

Gotcha.

Okay, so it's pretty recent.

So within the last 45 days, how many applications have we gotten?

How's the program going so far?

Okay.

So there's um, I believe four buildings in the pipeline for the program.

And then how how many office?

Actually, I can just check this online.

Thank you.

Okay.

I will just say, sorry, to for the previous commissioner, if you uh go and check the uh memo for this, it'll it gives you the specific buildings and addresses within the program.

So if you go to the January 27th council meeting, um you'll find the information.

One last comment.

Um, so uh beautiful presentation by you both.

Um would I think it would be really useful if we can get these slides beforehand coming into the meeting because I mean I checked the gender I message I'd share today as well.

Um it kind of you know, so we can ask a little bit more better questions and have a better understanding if you guys could send that next time, perhaps.

Yeah, I understand I hear you.

Yeah, thank you.

It's it's I appreciate the feedback.

We would have the same question.

Yeah, that was I was kind of going along that.

Did you actually send the report and the plan to any of us here?

I apologize, guys.

I don't know if I missed it or not.

Was it actually sent out for us to before?

It's a it's a it's a study session, so it was just the description of of kind of what we're talking about today.

I think um if we if we do this joint format again, so what went to so Monday was the city council um committee meeting, and I think um what we can do next time, and I think what we could plan to do is if we do this same staging of like a Monday then a Wednesday is what we we should have prepared you with is sending you the report that went to that committee on Monday that was written to that committee that has more detail um and then try to get you the slides uh um earlier.

So that that was um and after this we can share that full um memo that was it's it's published on the um uh the committee meeting agenda for Monday, but but um that's what we we um should have should have sent.

So yeah, I went outline that and see the the report to the full report because I'm assuming that's what with these letters are 13.

Is that a reference to those are references to the specific housing element programs?

So if you go in in chapter three of our housing element, they're all numbered, and we've carried that numbering over to our housing catalyst work plan as well, but it could it it chases the route back to the housing element itself.

Okay, they're administrative categories.

Okay, got it.

Yeah, because I was wondering if on the housing continuum page we see here unit preservation, unhouse outreach, uh encampment resolutions.

Do we have or is there a report and can you send us our report all the dollar amounts tied to this?

Like unit preservation, encampment resolution.

Yeah, Chair Navarro, um, uh you can the city's budget is a public document, and you can look at any fiscal year's operating budget and go to the housing section.

I believe for the last year it was around page five hundred and ninety-six.

Um sorry, uh the the find feature in the PDF will be your friend.

Uh but you these are publicly available documents and so you can uh find uh it's surprisingly easy to read through I know it's a very long document but um it's it's not too hard to navigate um if if you're someone who can navigate through a PDF um and you can look through um all the different uh uh items of uh line items of funding for the housing department there and it's break up by these type of categories exactly um they're not going to be word for word but they will be close and um if you have additional questions after looking at the budget you're welcome to contact our office okay thank you the easiest way is probably to just use AI and ask the question load the document and then just ask the questions that you want probably I can't guarantee that that will get you an accurate answer though.

Okay.

But that will give you a quick answer that will be probably close.

Got it thank you.

What are um what if can you explain what uh cities like San Diego and Sacramento are doing to get up to 25% of their arena numbers.

Ah this is a very important point.

So if you look at that slide what you need to also look at is that San Diego and Sacramento are 50% through the cycle and we are 25% through the cycle.

So listen that still would put us if we were doing exactly what we've done thus far at about 17% and they're at you know 25 and 27% if we're rounding up so it's a fair point that we're still not doing as well.

I would say a few things one is the cost of development is less there's more also more available land in both of those cities.

I will say typically San Jose and San Diego are usually quite comparable in terms of size.

We're similarly um sort of large geographic footprints um and a mix of urban and suburban um but still it is the cost of living is less in in San Diego um the cost of labor is less um uh so that's part of it but um perhaps Jared has some more if if you've spoken to these cities lately it's a variety of factors you know Sacramento and San Diego both have um their own kind of version of small multifamily that they've already implemented um Sacramento's was in 2024 San Diego has what they call their ADU density um bonus program um I believe is the name um but it does a similar approach to looking at how to sort of add more units um in in certain single family neighborhoods um so we you know our programs were we're looking you know kind of at some of the things that they had done you know um kind of going before us um so we're we're trying to emulate some of what they're doing and you know obviously trying to learn from from their successes but um so some of the challenges as as we're seeing as Sarah alludes to are are somewhat regional that we've seen in the cost development both for when we look at market rate but also when we look at affordable housing as well so that was one of the analysis done in the affordable housing portion of the cost development report looking at how the cost of affordable projects are and we and for those we have the actual um numbers of those um those uh those projects because they they submit those numbers directly when they apply for for tax credits and we can see there that there is a difference in terms of cost and um it does it does have a you know material impact in terms of what's able to move forward into construction both for market rate and affordable is the biggest factor labor costs.

It's one of the factors I I you know I would I don't know if it's the largest.

I don't know what, you know, it's it's materials, it's labor.

It's definitely what what you know near the top.

I don't know how it would stack precisely, but it's definitely a significant factor.

Are the ADU programs in those cities, specifically San Diego, yielding significantly better results than the program we have here in San Jose?

Well, we haven't done it yet, right?

So that's their trying to get to our small multifamily program and get that done.

Um the it's been mixed success.

I think the this the San Diego one, they call it an ADU program, but it's really around adding adding more units.

Um it's kind of a unique one.

Um it's been fairly successful.

I don't um, you know, how much it's added to those numbers.

It's it's in in Sacramento, I know it's just it's been since 2024.

Um I think, and this is actually getting into what we'll talk about next Wednesday.

I think um they've had about 29 applications since they've passed theirs.

So um it um, you know, it's still sort of a work work in progress for them.

Um, but um, you know, it it it's slow, but I think it's it's trying to set the framework again as Sarah alluded to.

You know, what we can do as a city is we provide the environment to try to encourage the development, and so everything we can do to try to improve and encourage that environment is what we're trying to do through through our policy programs.

And then uh Commissioner Pierre Luigi may know this, but I remember him discussing the um the sentiment of the supervisors in San Francisco about how these arena numbers, the housing element are exercise are exercises in futility.

Do you know of cities like San Diego and Sacramento, uh their city councils have the same sentiment?

I don't know what I haven't tracked their specific comments.

I mean, I think you know what I can say from conversations at a staff level, um, you know, is I think we're we're we're all in a similar situation where we're kind of doing the best that we can and trying to, you know, stick I mean the at the end of the day, this is what we've been assigned through the state and what we have an obligation to try to fulfill through our housing element.

Um, you know, regardless of some of the realities, we still have to do everything we can to try to achieve it.

Um, but but as you can see through this chart, even sort of how we compare everyone's sort of add a real challenge to sort of achieve what's been been set, right?

Um just as a time check, it's 6 33, and we do have two comments from the public.

Um any other commissioner has anything they'd like to add quickly.

One point of um just one quick point.

I'm happy to go whenever it's possible.

Commissioner, I have a couple of questions.

Um thank you for the presentation.

Uh first question, you mentioned that uh it sounds like SB9 update uptake is pretty low.

Um, are there any strategies at either the city or state level um on trying to increase the uptake of SB9?

I just want to say like some of the challenge is that it for SB9 you have to have the owner living on site to be able to do the lot split.

And so while there was initially uh you know many developers who are interested in in you know doing a lot split and developing um because of restrictions within the law, um i it it's just it's it's it's fairly narrow in in its application.

Yeah, no, I just to add to that too.

I think that's where we're sort of honing in on our program is how we could we could we could create our own program that that tries to maybe take out some of the p the parts of SB9 that haven't made it successful.

Um, you know, obviously trying to to make sure that you know there's a reason some of those policies are there, right?

It's because we want to encourage you know home ownership and those sorts of things, but to the extent that they're a hindrance, you know, through our local program, we could modify it to try to, you know, move the needle um to where people you know maybe there would be higher uptake.

Um, I still think there's still the realities of kind of the economics and all that, but um, you know, trying to to position our own program to to make it move forward.

Um but there's there's always new state laws.

I I know there's probably some SB9 um modification bills coming um this this session, so um, you know, there's there's a lot of moving pieces and people trying to to see it be successful.

Thank you.

And one more question.

So um I was reading the website and it uh it looks like the the housing catalyst team was developed in 2018.

Um it comprises of different departments at the city level and um that you guys uh give reports every year to uh commissions and city councils.

I'm just curious, um, I guess has it helped or can you give any examples of how um the merging and the court the coordinating between these departments has actually led to um meeting any of the city's goals around housing.

I'm just curious kind of what that's uh what what that's looked like over the years.

Yeah, sure.

I I think it um to where it's been successful is that we've been able to uh as we went into this housing element, having that team established and having you know very clear policy goals in mind, a lot of what was we developed through that team effort was put into the housing element.

So the concepts around trying to do our own ministerial ordinance, the concepts around trying to do small multifamily, all that was learned through some of that teamwork and team effort to try to you know move the needle and move the policy effort uh forward.

Um so I mean I I think the the collaboration um and unified goal um has been helpful in in the policy work because it you know it really involves multiple departments.

It's not just us working in silos, it's not just about land use, it's not just about you know affordable housing financing, it's how do they all play together?

How do they work in an e you know to create that environment to see housing production happen?

Thank you.

One last question, I was right.

I know that's a post probably online, maybe overweight.

Um but I want I do want to know around the urban village planning.

You know, I know that we had a debacle with the silicone sage and what are some of the measures to prevent that from reoccurring.

So the the urban village um evaluation effort um is about how we uh try to streamline the the village planning process.

So we uh the general plan is identified sixty-two urban villages.

Um to date we've completed sixteen.

Um and so thinking through what are some strategies to try to see that process move forward more more quickly.

Um and so that that's really what that that program is about because when you have an unplanned village, there's less opportunity for housing until we complete the effort to change the land uses in that village to allow for residential or mixed use.

Otherwise, they're primarily commercial.

Um so and part of the the key one of the key aspects of the urban village process is talking to the community, working with the community to develop a vision and plan for their area, but it's also you know one of the contributors to to time.

So um it's trying to balance those things out to provide opportunity for housing, but still provide a pathway where we can do good planning work in terms of working with the community to see what they want to see happen and occur.

Um and I don't think it maybe speaks to directly to your comment, but making sure that before development happens that there's an opportunity to talk with with the neighborhood.

Yeah, if I can get an email, we can follow up offline just to make sure that there is like some prerequisites and even through the process or some check-ins, I'm sure, just for for me to familiarize myself more with that process and just making sure that it doesn't happen again.

Yeah, definitely, and happy to send some additional information on the urban, you know, some of that what we're talking about in terms of urban village work.

So we have roughly 10 minutes left.

Um, Commissioner Oliver.

Yeah.

Uh lots to say here and don't have the time to do it, but thanks for the presentation.

And uh I think the SB9 adoption I think is just a matter of time and lower interest rates.

I think SB9 was passed at a time where really nothing was getting built, and uh just takes a while for people to wake up and see that they can do things differently.

And then I would just have the staff maybe before the next uh general plan meeting where we're talking about the next topic, you might want to check in about the city of San Diego because um the San Diego Tribune says that after a seven-hour meeting, they pulled back a lot of the incentives in the ADU program because they became too controversial in the neighborhood.

And as staff is looking to do something, you may want to look at that as a case to say maybe not that, maybe something different, et cetera.

Yes, I think the way that we're, and this is something we could talk about on Wednesday too, is is kind of what they were looking at.

Is is we're we've sort of kept that in mind in terms of how theirs allows a lot kind of more growth and density through the bonus than I think what we're going to propose.

So definitely hear you on that, yeah.

And always interested in learning from our neighbors across the state.

Yeah.

One quick question, and then one comment.

Um the comment is what would be helpful is one to send the document ahead of time, definitely.

Yes, that's understood.

And then the second thing that would be helpful is you know, at least a footnote or some reference to where to find these, because they're large blocks of information, just a sentence that can't adequately describe what you're really trying to get to.

Uh you know, it would be great just to have links to those items so that we could just get to them quickly, uh, if possible.

Yeah, no, uh understood completely and and um if we if we share the report from the committee, it it will be it'll be more apparent.

So I understand where you're coming from totally.

And then the last thing is a kind of an interesting question.

Uh it's a more to the up to the moment question.

Um, the linkage land to capital entitlement feasibility analysis.

What would that encompass and what would that have prevented the kind of moral hazard we have right now with the FAA downtown, the building buffet?

I'm I'm not sure what you mean by moral hazard.

Well, the the building went into receivership after less than a year of occup of occupancy.

Seems like some sort of hazard to me.

Well, more on that building in the coming months, but um you know, I I think the the feasibility study is really looking at um, you know, there's tens of thousands of units entitled.

What that will be entitled through the end of this current calendar year, um you know what are the what's the likelihood of um construction of those units based on on economic analysis, um and are there things the city can do to make those units more feasible, or um, you know, are there are these really efforts that are outside of the control of the city?

Um, we only have so much that we can do, um, but you know, there's a lot that we can do.

You know, is there um, you know, are there development agreements that we can consider?

Are there their fees or charges that we can um reduce or eliminate?

Um, should we be targeting particular geographies?

I think all these are are important questions to be asking, and um we'll go into that um full analysis of uh uh of currently entitled units.

Would that include uh the actual project feasibility in terms of cost of units, number of units, uh cost of money?

Would it would it go that deep or would it be a little bit?

So I I can't speak to that level of detail because the report is not yet done.

Um, well, shouldn't you know that before you write the report?

So I Sarah Fields am not writing the report, so I don't know all the particular.

That's a royal view.

Sorry, whoever's writing the report.

Yes, I'm sure yes, absolutely.

We do have a meeting at seven o'clock, and we're going to need to give the.

But that's an important question because we're about to subsidize a building that was not well formulated in its format in its cost per unit in square foot.

So that's not on the agenda this evening.

Um actually it is, because I just put it on.

So what I'm saying is that that's important for us, because we are about to approach a moral hazard of taking city money to bail out a new development.

That's a moral hazard.

Commissioner Cantrell, you know that that's not how we put something on the agenda.

I understand.

I understand, but I want to be clear that I'm asking a question, and I I understand that maybe you don't want to or can't answer, but don't tell me I don't have a right to ask.

I think we have a quick comment from uh one or two of the planning commissioners, but we do need to get to public comment and we do need to be in the next room in the as soon as possible.

Um border.

I don't I don't understand.

At the housing commission, we keep going until all the questions are answered.

I've never been to a planning commission meeting, so I'm not sure how you agendize these, but there seems to be a lot more questions that need to be answered.

And you're saying we're gonna cut the meeting off before those questions are answered.

Is that what you're saying?

So there's a scheduled planning commission meeting at 7 p.m.

And there are folks who are coming to that meeting expecting it to start at 7.

I think this was a scheduled study session that was gonna last from 5:30 till 7.

It's unfortunate that there's comments that haven't been received, but you can write an email, you can follow up with the folks here, the staff uh and I will also remind all of the commissioners that this item will be coming before the city council on March 24th, and you're welcome to submit public comment through the city clerk uh via email or to be present at the meeting and make comments.

And this is not the last time that the housing element is gonna come before hopefully there's a joint session.

Um I don't know if you guys have something planned for the future.

So that again that will go before city council on March 24th, both both the housing catalyst and the housing element annual progress report.

And if this were a planning commission meeting or a housing commission meeting, obviously we would continue until everybody had the questions, their questions answered, but unfortunately it's a study session.

And I'll remind everyone that a study session means there is no formal vote, it is just feedback.

But if you have a comment, I had some questions and comments, but for expediency's sake, since you all need to get out of here and go to another meeting, I would just say the next time we have a joint study session, you allow us more time so that everybody can get their questions in.

This I see other people still here who have questions, but we're running out of time.

So if we do have another joint session, please allow us to have more time.

Give us a couple hours instead of an hour and a half or an hour.

If I could just I I think that's fair feedback, and you know, like I said at the beginning, we're where this is our first time doing a joint.

It wasn't meant to limit, we you know, and if if this isn't the format that works, we're happy to change as well, too.

So we definitely hear you and understand we're we're not we weren't trying to limit commissioners' ability to provide us with comments and feedback.

So I just we hear you and we understand.

You have two groups of commissioners here and they have lots of questions, so it would seem to me that you would allow more time for the meeting.

Understood.

I didn't plan the meeting, so just going forward, I would like to see more time.

That's all thank you.

I think it's very clear that we would like to see more time, and it's very clear to me just looking at people's faces that there are many more questions that they would like to ask.

But I do want to get to public comment.

We only have two speakers, so if you would please come to the microphone, if you still would like to.

I serve on the senior commission of representing district three, and I absolutely am enjoying this tonight because this is contentious and it should be.

A comment with talking with your community.

This is how you get the feedback.

When I moved in here in there three and a half years ago, my rent was 1469, which is on here, the market rate.

It is now 1688.

That has gone up 200 a month.

Your affordable is not affordable for seniors in San Jose.

I can promise you that.

You have to move in with a two and a half times your income to afford affordable.

Now, when we talk about affordable and we use that word like it's water, it is not affordable.

Let's find another word.

Um, and so moving people moving into my complex now have to come in with $1,800 a month.

They have that's what they're paying their rent.

That's starting.

Okay, so we what when we're talking about community and and discussing about what's before what's after.

These are things that you have to take into account.

I do not see how living in San Jose is affordable for anybody.

Thank you.

Thank you.

Is there another comment?

All right.

Hearing none, I know we have to give 10 minutes before the seven o'clock meeting.

Um, unfortunately, we are out of time.

Do you have something very quick to say?

I was just gonna ask like two quick questions.

Um maybe next time we can share time.

All right.

Uh ten uh about subsidized home ownership.

Um did that begin and how would a person know about it?

Yeah, so if I go to that.

So the question was uh about subsidized home ownership.

Um, you know, when such an opportunity exists, um, you know, how would you find out about it?

Um so through the the housing department website, you can apply for affordable housing.

Um if and when there's ever an opportunity for affordable or subsidized home ownership, those same opportunities would be available.

There would be um uh income verification, uh, area media income level set, um, and we can talk about it more.

Uh at an at a future HCDC meeting.

And then one um other question, as far as like the urban village.

I lived on San Carlos, 1530 West San Carlos, for 10 years.

It was my first stable housing in my whole life, where I had um other eight units, individual units.

Uh I found a place right away with a nice landlord, but the rest of the people were um not so lucky.

One of them passed away last year.

Um several of them got arrested for mental health issues.

Um lady moved every year in her 70s, and the place is still there.

Nothing began, the work hasn't begun.

The anti-displacement assistance was never um available to none of these people, and they moved during COVID, so it was just my experience.

Okay, um obviously I'm I'm sorry to hear that, and um if anyone is is questioning whether they qualify for for and for a displacement look uh or relocation assistance, they should call the housing department um and we will connect you with our rent stabilization team to verify um eligibility.

Thank you.

That was brief.

Thank you very much.

All right.

With that, with that we'll adjourn the study session and prepare for the planning commission.