TO: HONORABLE MAYOR
AND CITY COUNCIL
FROM: Planning Commission
SUBJECT: See Below DATE: April 24, 2025
COUNCIL DISTRICT: Citywide
SUBJECT: GPT25-001 - General Plan Text Amendment for Policy IP-5.15 Envision San José 2040 General Plan for Urban Villages
RECOMMENDATION
The Planning Commission voted 6-0-3 to recommend the City Council take the following action:
Adopt a resolution approving a City-Initiated General Plan Text Amendment to amend Policy IP-5.15 of the Envision San José 2040 General Plan to address the need to identify a stable, internal funding source for the urban village planning process.
SUMMARY AND OUTCOME
Approval of the General Plan Text Amendment would amend Policy IP-5.15 of the Envision San José 2040 General Plan to encourage the City to identify a stable, internal source of funding for the Urban Village planning process in addition to the existing efforts to actively pursue outside funding opportunities.
BACKGROUND
On April 23, 2025, the Planning Commission held a public hearing to consider the proposed City-initiated General Plan Text Amendment. Commissioner Lardinois made a motion to approve the recommendation. Commissioner Rosario seconded the motion.
The motion passed 6-0-3 (Commissioners Cantrell, Barocio, and Young absent).
COUNCIL AGENDA: 5/6/2025
FILE: 25-472
ITEM: 10.1(a)
HONORABLE MAYOR AND CITY COUNCIL
April 24, 2025
Subject: GPT25-001 - General Plan Text Amendment for Policy IP-5.15 Envision San José 2040 General Plan for Urban Villages
ANALYSIS
A complete analysis of the General Plan Text Amendment is contained in the attached Planning Commission staff report for its April 23, 2025 meeting.
EVALUATION AND FOLLOW-UP
If the proposed resolution is approved for adoption by the City Council, the General Plan Text Amendment shall take effect immediately following approval of the resolution.
COORDINATION
The preparation of the proposed General Plan Text Amendment was coordinated with the City Attorney’s Office.
PUBLIC OUTREACH
This memorandum will be posted on the City’s Council Agenda website for the May 6, 2025, City Council meeting.
COMMISSION RECOMMENDATION AND INPUT
This item was the only item on the April 23, 2025, Planning Commission General Plan Consent Calendar. No members of the public requested to speak on the item and there was no discussion by the Commissioners.
Commissioner Lardinois made a motion to approve the General Plan Consent Calendar. Commissioner Rosario seconded the motion. The Planning Commission voted 6-0-3, with Commissioners Cantrell, Barocio, and Young absent, to recommend the City Council approve this item per staff’s recommendation.
CEQA
Not a Project, File No. PP17-008, General Procedure and Policy Making resulting in no changes to the physical environment.
HONORABLE MAYOR AND CITY COUNCIL
April 24, 2025
Subject: GPT25-001 - General Plan Text Amendment for Policy IP-5.15 Envision San José 2040 General Plan for Urban Villages
PUBLIC SUBSIDY REPORTING
This item does not include a public subsidy as defined in section 53083 or 53083.1 of the California Government Code or the City’s Open Government Resolution.
/s/
Chris Burton
Secretary, Planning Commission
For questions, please contact Jerad Ferguson, Principal Planner, Planning, Building, and Code Enforcement, at [email protected] or (669) 223-1160.
ATTACHMENT
Planning Commission Staff Report from April 23, 2025
PLANNING COMMISSION AGENDA:
ITEM:
TO: PLANNING COMMISSION FROM: Christopher Burton
SUBJECT: GPT25-001 DATE:
COUNCIL DISTRICT: Citywide
Project City-initiated General Plan Text Amendment to amend the Envision San José 2040 General Plan to address the need to identify funding for urban villages.
Project Description City-initiated General Plan Text Amendment to amend Policy IP-5.15 of the Envision San José 2040 General Plan to address the need to identify a stable, internal funding source for the urban village planning process.
CEQA Clearance Not a Project, File No. PP17-008, General Procedure & Policy Making resulting in no changes to the physical environment.
Project Planner Kristine Do
RECOMMENDATION
Staff recommends that the Planning Commission recommend that the City Council take all of the following actions:
1. Adopt a resolution approving the General Plan Text Amendment to amend Action IP-5.15 of the Envision San José 2040 General Plan to address the need to identify a stable, internal funding source for the urban village planning process.
PROJECT BACKGROUND
The City of San José submitted its first Draft 2023-2031 Housing Element to the California Department of Housing and Community Development (HCD) in 2022. HCD issued a formal comment letter, dated December 15, 2022, outlining necessary changes to bring the City’s housing element into compliance. In the letter, HCD acknowledged the importance of Urban Villages, citing them as “essential to the City’s approach in addressing its housing needs,” while also highlighting concerns regarding existing constraints identified within the City’s housing element, including costs to prepare planned and unplanned urban village areas.
The City’s first Draft Housing Element included Program P-37, CEQA Analysis for Urban Villages, which commits the City to identify funding and program-level CEQA analysis for urban villages by 2027. HCD cited that the timeline for implementation was too late into the planning period and made recommendations to include a program to conduct an in-depth mid-term evaluation of actions that incentivize or remove constraints on urban villages, including effectiveness, and commit to making adjustments within a specific time period.
File No. GPT25-001
The City’s second Draft Housing Element Housing Element included Strategy P-40, Evaluate Urban Village Planning Process, with an action item to “recommend the City Council amend the General Plan Policy IP-
5.15 in 2024 to encourage the City to identify a stable, internal funding source to cover the majority of the costs for urban villages planning processes.” Staff took the second Draft Housing Element to City Council on June 20, 2023, where City Council voted to adopt the Housing Element. HCD did not have any feedback on Strategy P-40 in its second comment letter, dated August 28, 2023, addressing the City’s Adopted Housing Element but had feedback on other programs. HCD certified the City’s Adopted Housing Element on January 29, 2024.
ANALYSIS
Strategy P-40 of the City’s Housing Element includes an action item to amend Policy IP-5.15 of the Envision San José 2040 General Plan (General Plan) to identify a stable, internal funding source to cover the majority of the costs for the Urban Village planning process. Implementing the Plan (IP) is a section within the General Plan that focuses on policies to guide the use of the General Plan for the ongoing land use decision making process, including Major Strategy #5 - Urban Villages, the planning process of which is defined in IP-5:
“Use new proposals for residential, mixed use, or employment development to help create walkable, bicycle-, and transit-friendly “Urban Villages” (also referred to as “Villages” within the Envision General Plan) at strategic locations throughout the City, and to enhance established neighborhoods. In new Village development, integrate a mix of uses including retail shops, services, employment opportunities, public facilities and services, housing, places of worship, and other cultural facilities, parks and public gathering spaces.” Policies IP-5.1 through IP-5.14 focus on implementing the Urban Villages strategy by identifying policies and goals to promote urban village planning and development. The General Plan establishes the Urban Villages concept to create a policy framework to direct most new job and housing growth toward major corridors and other existing infrastructure and facilities, leading to increased density in and around these areas. IP-5.15, specifically, is a call to action to “develop Urban Village Plans for Village areas identified for housing growth in the current Horizon proactively, ahead of developer demand to begin residential development there. Actively pursue outside funding opportunities for the Village planning process.” While the Urban Village strategy and policies highlight compact, walkable urban districts, it does not identify any permanent sources of funding associated with the planning and development of that long-term goal. Staff has historically sought out other sources of funding, including external sources such as one-off grants, to continue to plan major villages.
Staff proposes to amend Policy IP-5.15 by removing the reference to “the current Horizon” and clarifying the City’s intent to identify a stable, internal funding source to cover the majority of the costs for the Urban Village planning process. Exhibit A provides a tracked changes version of the proposed amendments to the policy. On December 14, 2021, City Council voted to approve General Plan Text Amendments associated with the second General Plan Four-Year Review and related to Urban Village Implementation and Policy Modifications (GPT 21-005). In this Four-Year Review, staff analyzed the impact of eliminating Horizons on potential development and found that although the elimination of Horizons would not catalyze residential development, it would eliminate an additional layer of complexity for future development.
Until the Horizon concept was eliminated, the General Plan did not support completing Urban Villages in quick succession and instead, prioritized only those that were included within the current Horizon. Since the Four-Year Review, the focus has shifted to completing the 60 envisioned Urban Village plans as quickly File No. GPT25-001
as possible to facilitate residential development in more locations throughout San José. This shift has exacerbated the need for a stable, ongoing funding source as historically, the City was able to forecast ahead based on the Horizon to plan for Urban Villages within the scope, enabling staff to apply for and rely on grants to fund the preparation of plans. As part of the Four-Year Review's elimination of Horizons, City Council directed staff to return to Council through the budget process with a proposed resource allocation dedicated to the creation of priority Urban Village plans, highlighting those that have the potential to unlock near-term housing opportunities based on market demand.
The 2019 Cost of Development study identified the De Anza, Paseo Saratoga, Saratoga Avenue, and South Bascom Urban Village Plans as those with the highest development potential based on research analysis and feedback from the development community. As a result of staff’s return to Council through the budget process, the Planning Division received a one-time funding of $400,000, funded by the Citywide Planning Fee Program Fund in Fiscal Year 2022-2023, that is currently being used to prepare the Saratoga Urban Village Plan, which combines both Paseo Saratoga and Saratoga Avenue. Staff is coordinating with an outside consultant, Skidmore, Owing, and Merrill (SOM), to complete the Urban Village Plan with a target date of Spring 2026 Council approval.
Staff is also coordinating with SOM on the preparation of the Alum Rock East Urban Village Plan, another strategy within the City’s Housing Element (P-36). The City applied for a Priority Development Area Grant in 2017 and was awarded $400,000 from the Metropolitan Transportation Commission for the Alum Rock Urban Village Plan. The grant required an 11.47% match, resulting in $51,825 by the City. Staff and SOM are currently working to finalize the plan with a target date of August 2025 Council approval.
To date, staff has not yet identified any other sources of one-time funding, internal or external, to prepare the remaining Urban Village plans. The Planning Division did not receive any additional funding and while the City routinely applies for grants, opportunities for funding are limited and can include criteria not aligned with market-ready urban villages that need completed plans. The proposed General Plan Text Amendments would prioritize the Urban Village planning process by clearly stating the City’s intent to identify a stable, internal funding source.
ENVISION SAN JOSÉ 2040 GENERAL PLAN CONFORMANCE
The proposed General Plan Text Amendment changes are consistent with the following General Plan Urban Village Planning Policies:
1. Urban Village Planning Policy IP-5.2: Develop and use an Urban Village Planning process so that each Urban Village Plan can be successfully completed within approximately one year, with the possibility of a longer process in order to conduct sufficient community engagement. The completion of an Urban Village Plan will be followed by completion of environmental review as required for adoption of the Plan. Engage Urban Village area property owners and residents to the fullest extent possible, along with representatives of adjacent neighborhood areas, potential developers and other stakeholders in the Urban Village Planning process.
2. General Plan Phasing / Major Review Policy IP-2.3: Prepare Urban Village Plans in advance of the redevelopment of an Urban Village to facilitate coordination of infrastructure, community facilities and parks planning with planned new residential growth, including use of the City’s Capital Improvement Program.
3. General Plan Phasing / Major Review Policy IP-2.10: Prioritize the preparation of Urban Village plans to File No. GPT25-001
give priority for new residential growth to occur in areas proximate to Downtown, or with access to existing and planned transit facilities, and adequate infrastructure to support intensification, or proximate to other Growth Areas to contribute to the City’s urban form. Growth Areas with high market demand shall also be prioritized to ensure that development follows the community’s vision for the future.
4. Major Strategy #5 - Urban Villages: Promote the development of Urban Villages to provide active, walkable, bicycle-friendly, transit-oriented, mixed-use urban settings for new housing and job growth attractive to an innovative workforce and consistent with the Plan’s environmental goals. The General Plan establishes the Urban Villages concept to create a policy framework to direct most new job and housing growth to occur within walkable and bike friendly Urban Villages that have good access to transit and other existing infrastructure and facilities.
Analysis: The proposed amendment would facilitate prioritization of the Urban Village planning process by stating the City’s intent to identify a stable, internal funding source to prepare the remaining unplanned Urban Villages. Currently, the lack of funding is a major obstacle in completing urban village plans and enabling potential development within those villages. A stable, internal source of funding would allow staff to focus their efforts on the planning work rather than the pursuit of grant application and management; prepare urban village plans in advance of development or redevelopment, particularly those within close proximity to other Growth Areas, contributing to the City’s urban form; and overall promote the development of the remaining unplanned urban villages by removing any major constraints. Therefore, the proposed amendment to Policy IP-5.15 conforms to the above-mentioned General Plan policies and strategies.
CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA)
Not a Project, File No. PP17-008, General Procedure & Policy Making resulting in no changes to the physical environment.
PUBLIC OUTREACH
Staff followed Council Policy 6-30: Public Outreach Policy in order to inform the public of the proposed project. The staff report was posted on the City’s website. Staff has been available to respond to questions from the public.
Project Manager: Kristine Do
Approved by: /s/ Jerad Ferguson, Principal Planner for Christopher Burton, Planning Director