With San Jose struggling to build homes and already behind in meeting the state’s expectations for production, the City Council is making it easier to construct housing on unused or underutilized urban areas.
Under a new streamlined review policy, planning staff hope to cut the time to process housing applications by a minimum of 25% to potentially more than 50% from the time an application is filed to when a permit is issued — a move they hope will speed up construction.
However, with only about 600 parcels qualifying and expectations that it might only see a few hundred extra units entitled per year, developers and elected officials say the city needs to expand the policy even further.
“It makes no sense,” land-use consultant Erik Schoennauer said. “There are so many exclusions (that) it’s going to generate nothing, so I hope in 2025 we can have a real talk about improving the city’s overall process.”
Despite the state’s mandate that San Jose plan for 62,200 units by 2031 — an average of 7,775 units per year — the city has struggled to keep up.
Last year was particularly bleak for housing production as the city only saw 2,666 units permitted and did not see a single market-rate multi-family housing development begin construction as rising interest rates and costs brought the market to a standstill.
Looking to unblock the development pipeline, San Jose has introduced or amended policies to help incentivize more shovels in the ground this year.
For example, the city extended its downtown high-rise program that waives some construction and building taxes and this month, the city introduced a temporary incentive program for multi-family housing developments in designated growth areas.
The streamlined process approved Tuesday includes minimum qualifying criteria: must have a minimum density of 40 units per acre, and be located in growth areas like planned urban villages and within half a mile of existing major transit stops or along high-quality transit corridors.
Exclusions include parcels with planned development zoning, within the airport influence area and within 300 feet of a creek or 100 feet of a city landmark.
One of the biggest changes the policy would make is allowing qualifying projects to forego the need for a public hearing. While planning staff also called for removing the community meeting requirement, city officials have pushed for developers to still hold informational meetings to strike a balance.
Over the past two years, the city estimated a 20-month review time for multi-family housing developments that sought approval at the planning director hearing level.
While acknowledging that the city could do more, Jake Wilde, manager of development projects at Catalyze SV, lauded the policy change as a necessary first step.
“There’s a lot of factors that affect the number of permitted units, the construction goals, not all of them within the city’s control, but permitting timelines are definitely within that level of control and this streamlining policy is a step in the right direction for reforming that,” Wilde said. “It could, of course, always be improved. We’d like to see an ordinance like this, one with an expanded geography, one that covers all urban villages and special area plans, as well as all land use designations that allow multi-family housing.”
In addition to spurring some housing, city officials also noted that policy implementation was important to the state, which they highlighted when approving the city’s housing element earlier this year.
“We have targeted time frames in our housing element that have been certified by the state (Department of Housing and Community Development), and we are on the hook to deliver on those,” Deputy City Manager Rosalynn Hughey said. “We are going to have to provide annual reports to HCD indicating our progress, and we know that they will be watching us closely, and so to that point, we want to make sure that we stay on those time frames that are identified in the housing element.”
San Jose Mayor Matt Mahan agreed that the streamlined process needed to go further, issuing a memo with Vice Mayor Rosemary Kamei and Councilmembers Sergio Jimenez, David Cohen and Dev Davis that called for the city to expand the ministerial process to the airport, downtown and other growth areas.
Mahan noted that some of the most frequent questions he receives are why haven’t urban villages progressed despite robust community engagement.
“We know it’s not just because it takes a long time to get through planning, but it doesn’t help that it can take a year or two, even after the planning, the zoning, all the community engagement, when we still then run you through what’s largely, frankly, a redundant process,” Mahan said. “This policy change, I think, strongly stands on its merits as a good step forward. If anything, we’re applying it in to far too little of the city, given how much work we’ve done in planning and how little housing we’ve actually seen built in the very areas where we say we desperately want it.”