Mathew Reed, Policy Director for SV@Home, acknowledges the complexity of San Jose’s housing shortage and affordability crisis, and the role of the city’s Housing Crisis Workplan in addressing these needs. “There wasn’t a silver bullet, but if we put all these pieces together, we can move the needle, and that general idea was picked up by the city and they put this list together. If (Liccardo) has long-term ownership, it’s for catalyzing this process.” SV@Home advocates for policies, programs, land use, and funding, such as those contained in the Housing Crisis Workplan, that lead to an increased supply of affordable housing. SV@Home also educates elected officials and the community about the need for housing, and the link between housing and other quality of life outcomes, including education, health, transportation, and the environment.

BY: Lloyd Alaban┃San Jose Spotlight
PUBLISHED:  August 30, 2021

San Jose Mayor Sam Liccardo four years ago proposed an ambitious 15-point plan to address the city’s housing crisis. And while the city has checked off many of those points over the years, it’s still shy of reaching one major housing goal.

One of the plan’s most important metrics is to build 25,000 homes by 2022—now 2023 due to some delays in council approval—including 10,000 affordable units. The city has completed 3,348 homes since 2018, with 506 of them affordable—far short of the goal with only two years to go.

The City Council learned earlier this month that it’ll be nearly impossible to construct 25,000 homes by 2023 at the city’s current pace.

“Construction costs have been the barrier, without a doubt,” Liccardo told San José Spotlight. The mayor said the city faces difficulty competing for state funding due in part to high construction costs.

Housing in San Jose—both market-rate and affordable—is among the most expensive in the country. According to a report from the National Low Income Housing Coalition, residents pay the second-highest rent in the country. The fair market rent for a two-bedroom home is approximately $3,051 a month.

Still, Liccardo says he’s proud of the housing goals the city has accomplished under his leadership though there is “a heck of a lot more work to do.”

The city rolled many of the mayor’s 15 proposals into other housing strategies over the years, such as the Housing Crisis Workplan. The end result is a 43-point plan incorporating ideas from Liccardo, his council colleagues and public employees.

Housing advocates such as Mathew Reed followed the plan over the years.

“There wasn’t a silver bullet, but if we put all these pieces together, we can move the needle,” Reed, a policy advisor for Silicon Valley at Home, told San José Spotlight. “And that general idea was picked up by the city and they put this list together. If (Liccardo) has long-term ownership, it’s for catalyzing this process.”

Here’s a look at Liccardo’s original 15-point proposal, and what the city has accomplished since its introduction in September 2017.

1. Finance housing for the “missing middle”: Craft a private-public financing mechanism for rent-restricted housing for modest- and middle-income workers, such as teachers, nurses and police officers struggling with high living costs.
   • Results: The City Council addressed housing development issues for its “missing middle” in June 2019, including creating a loan program for the construction of backyard units, developing housing in North San Jose and rehabilitating older apartments. In April 2019, the City Council committed $10 million to the Affordable Housing Investment Plan, which prioritizes how the city uses its resources to meet its housing goals. The council also set aside funding for moderate-income housing through Measure E, a property transfer tax increase to fund affordable housing.
2. Expand housing for students, faculty and other workers at San Jose State University
   • Results: In 2019, the city, along with Airbnb, SJSU and the Bill Wilson Center created a homeless student housing program that connects Spartans to temporary housing, though it’s unclear how many total students were housed under the new proposal. The university also acquired the Alquist Building for affordable housing development, and the city is considering allowing school districts and churches to create permanent supportive and affordable housing.
3. Partner on teacher housing projects
   • Results: Educators are struggling to live in Santa Clara County. The city’s largest school district, San Jose Unified, along with Liccardo, floated the idea of building affordable housing for teachers but that has yet to happen.
4. Better utilize Caltrans land for homeless housing
   • Results: The city worked with Caltrans and nonprofits to develop bridge and emergency interim housing on two Caltrans properties, one VTA site and two city-owned spots.
5. Revitalize struggling business districts
   • Results: The city estimates zoning updates will be approved this fall to allow 100% affordable mixed-use projects in certain parts of the city. Some officials have called for property-based improvement districts in East San Jose to help spur economic activity.
6. Double down on downtown: Eliminating constraints in development guidelines can bring more housing in towers adjacent to new transit, adding vitality to the city core without the burden of freeway traffic.
   • Results: The city has cut red tape and reduced fees in downtown to encourage more high-rise construction and denser residential development. Some developers, such as venture capitalist Gary Dillabough, are going all-in on efforts to revitalize downtown San Jose.
7. Transit-oriented affordable housing in North San Jose: Eliminating longstanding legal hurdles can enable the construction of 2,400 affordable homes adjacent to light rail and BART stations in North San Jose.
   • Results: Major development has occurred in North San Jose and around the Berryessa BART station in recent months. In April, Liccardo, along with Councilmember David Cohen, teamed up with local advocacy groups to push for affordable housing in the tech-heavy district. City officials are dropping a development plan that limited the number of housing units that could be built in North San Jose until it met commercial development goals.
   • The council voted in June to approve up to 3,450 housing units in the Berryessa BART urban village—though it will shrink the region’s iconic flea market by two-thirds. Construction is set to begin no earlier than 2023.
8. Encourage construction of secondary units, such as accessory dwelling units
   • Results: The city streamlined its permitting process and loosened regulations to encourage development of accessory dwelling units (ADUs) or “granny units.” This has led to a sixfold increase in ADU permit applications over the past three years, according to the city.
9. Protect residents from displacement
   • Results: In September 2020, the council approved a three-point plan to address displacement. Part of that plan includes creating affordable housing under the Community Opportunity to Purchase Act (COPA) in the city. COPA would give nonprofits funding to buy rental properties when they go up for sale.
   • The three-point plan also includes aid during the COVID-19 pandemic. One of the city’s most visible plans is the extension of its eviction moratorium in June, which helped tenants delay paying owed rent due to lost income during the pandemic. The state has since extended its own moratorium through September.
   • The plan includes pushing a “tenant preference” policy, which sets aside a portion of affordable apartments for certain applicants, such as people in low-income neighborhoods or domestic violence survivors. But these groups have to be recognized and defined by either the federal or state governments. A bill proposed by Sen. Dave Cortese (D-San Jose) looks to solve this problem by allowing cities to create groups. The bill is still in the Senate.
10. Move urban villages with existing transit to the front of the line
    • Results: According to the city’s housing workplan, it’s started and completed multiple projects related to the city’s urban villages—areas near public transportation with the possibility for dense housing. Developments have ramped up in the city’s downtown urban village and in the Berryessa BART urban village.
11. Better identify housing sites to prospective developers
    • Results: The city has attempted to reduce barriers for developers to work with the city, including the creation of a new housing site explorer webpage to help potential builders identify housing sites.
12. Re-evaluate fees to encourage construction
    • Results: Last September, the City Council approved charging commercial developers a fee to fund affordable housing. The fee will give developers building projects more than 100,000 square feet three fee options: $12 per square foot if paid upon the certificate of occupancy, $15 per square foot if paid in phases or no fee if the developer agrees to build affordable housing. Google is expected to contribute $87 million in fees as part of its Downtown West development to help fund affordable housing. There isn’t yet a solid timeline yet for distributing funds.
13. Incentivize neighboring cities to do their share
    • Results: This item was dropped from the updated 43-point plan, but some other Silicon Valley cities are already considering building denser.
14. Generate more funding for affordable housing
    • Results: 2020’s Measure E is expected to help generate $25 million to $75 million annually for affordable housing projects.
15. Redevelop nuisance properties
    • Results: The city is exploring changes to its general plan to allow more housing development on what it calls “problem properties.” The city hopes to start exploring the idea in the near future through an update to its general plan, which guides the city’s development plans through 2040.

Liccardo says measuring the city’s success on housing development boils down to whether a single mom struggling to make ends meet can afford a “safe, dignified” apartment for her kids.

“Is a teacher going to be able to stay and live in the city where he or she teaches?” the mayor added. “That’s the real measure. But the truth is we’re a long way off from that goal. That doesn’t mean we can’t make a lot of progress. There is progress being made.”

Read the city’s 43-point housing plan in its entirety by clicking here.