Item 3.4: Second Quarter City Council
Focus Area Status Report for Fiscal Year
2025-2026
San José City Council March 10, 2026
City of San José
City Manager’s Office
Lee Wilcox, Assistant City Manager, Reducing Unsheltered Homelessness Jennifer Schembri, Deputy City Manager, Increasing Community Safety Angel Rios, Deputy City Manager, Cleaning Up Our Neighborhoods Rosalynn Hughey, Deputy City Manager, Building More Housing and Growing Our Economy Erik Jensen, Deputy Director, City Manager’s Office
1 Focus Area Background
Agenda
1 2
3 Execution as Learning – Focus Area Portfolio Update
Next Steps
2 3
Focus
Areas (5)
Core Services (74)
Budget Programs (259)
Complex long-term
initiatives requiring
significant staff
capacity and cross-
department
coordination
Services that the
City routinely
delivers and
Departments largely
manage
independently
Focus Areas
An Opportunity to Evolve
We are cultivating an organizational mindset
of learning and continuous improvement that
will drive results for our community
While data support storytelling, numbers alone do not show progress and require context setting
Learning in public builds trust and accountability
Retrospection contributes to learning and understanding Progress requires humility, iteration, and commitment 4 Focus Areas
Philosophy and Principles
Increasing Community
Safety Focus Area
5 1. Emergency Response. Lean staffing and high call volumes strain the capacity of police and fire response.Problem Goals Metrics San José residents live in a community with responsive emergency services and safe streets and roads.
Long-Term
Goal Indicators
2. Crisis Response. Missed opportunities to connect crisis calls with a more appropriate response that does not drain emergency response capacity.
Problem Goals Metrics
3. Crime Reduction. Though crime rates are trending downward, a few crime categories remain stagnant across California.Problem Goals Metrics Increasing Community Safety Focus Area
4. Traffic Safety. Traffic engineering practices initially prioritized speed and volume, often at the expense of safety. Speeding is the primary cause of fatalities and serious injuries in San José.
Problem Goals Metrics
6 0%
20%
40%
60%
80%
100%
Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Q3 FY25 Q4 FY25 Q1 FY26 Q2 FY26 Resident Safety Perception
% of residents rating San José as "very safe" or "somewhat safe"
City Safety Perception
Neighborhood Safety Perception
Downtown Safety Perception
What’s going well. San José is proud to be recognized as the nation’s safest major city, thanks to low crime rates, strong public safety services, and connected neighborhoods. As of June 2025, more than 80% of residents said they feel safe in their neighborhood—an increase of 10% since September
2023.
Main Challenges Moving Forward. While overall crime rates continue to decline and remain lower than in peer cities, ongoing efforts are needed to keep this progress moving forward. Lean staffing and high 911 call volumes continue to put pressure on police and fire response times. On our streets, speeding is the primary cause of fatalities and serious injuries.
The City is advancing a safety-first approach to transportation to make our streets safer for everyone.
San José residents live in a community with responsive emergency services and safe streets and roads..
Long-Term
Goal
Context Indicator
Increasing Community Safety Focus Area
7 City: +2% Year-over-Year (YoY)
Neighborhood: +2% YoY
Downtown: +5% YoY
1. Emergency Response. Problem
The policing profession faces a
workforce crisis nationwide, making it
harder than ever to recruit and retain
qualified officers. Fire station demands
challenge existing capacity, especially
near the City’s central core.
The San José Police and Fire
Departments are among the most
respected public safety agencies in the
industry. The City is also a leader in
developing innovative emergency
response solutions.
The City is increasing academy
recruitment efforts and implementing
new opportunities to improve emergency
response deployment capacity.
Context
San José residents live in a community with responsive emergency services and safe streets and roads.
Long-Term
Goal
Increasing Community Safety Focus Area
8 Police Priority 1 Response: +3% YoY
Police Priority 1 Call Volume: +4.5% YoY
Fire Priority 1 Response: +2% YoY
Fire Priority 1 Call Volume: -6% YoY
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Q1
FY24
Q2
FY24
Q3
FY24
Q4
FY24
Q1
FY25
Q2
FY25
Q3
FY25
Q4
FY25
Q1
FY26
Q2
FY26
Police Priority 1 Response
Compliance
% of time the first dispatched Police unit arrives to
Priority 1 calls in less than six minutes
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Q1
FY24
Q2
FY24
Q3
FY24
Q4
FY24
Q1
FY25
Q2
FY25
Q3
FY25
Q4
FY25
Q1
FY26
Q2
FY26
Fire Priority 1 Response
Compliance
% of time the initial responding Fire unit arrives to
Priority 1 calls in less than eight minutes
0 200
400
600
800
1000
1200
Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Q3 FY25 Q4 FY25 Q1 FY26 Q2 FY26 Crimes per 100,000 Population
Crimes Against Persons
Crimes Against Property
Crimes Against Society
3. Crime Reduction. Problem
Some crime types across California
remain stagnant.
Compared to other large cities, the
City stands out for having lower rates
of both violent crime and property
crime.
The City is pursuing targeted crime
reduction strategies.
Context
San José residents live in a community with responsive emergency services and safe streets and roads.
Long-Term
Goal
Increasing Community Safety Focus Area
9 Crimes Against Persons: -13% YoY
Crimes Against Property: -5% YoY
Crimes Against Society: +3% YoY
0 2
4 6
8 10
12 14
16 18
Q1
FY24
Q2
FY24
Q3
FY24
Q4
FY24
Q1
FY25
Q2
FY25
Q3
FY25
Q4
FY25
Q1
FY26
Q2
FY26
Traffic Fatalities by Decedent
Mode
Bicyclist
Pedestrian
Motorcyclist
Motor Vehicle Occupant
0 10
20 30
40 50
60 70
Q1
FY24
Q2
FY24
Q3
FY24
Q4
FY24
Q1
FY25
Q2
FY25
Q3
FY25
Q4
FY25
Q1
FY26
Q2
FY26
Killed and Severe Injuries (KSI*) due to
Traffic Collisions
Fatal Injuries
Severe Injuries
4. Traffic Safety. Problem
Changing driving behavior and
building safer streets in a large City
takes time.
The City has made important strides
towards Vision Zero over the past
decade.
The City is investing in
infrastructure improvements and
new roadway technologies to
increase safety.
Context
San José residents live in a community with responsive emergency services and safe streets and roads.
Long-Term
Goal
Increasing Community Safety Focus Area
10 KSI: +34% YoY
(based on Q3 FY25 most recent)
Fatalities: +4 YoY
* Severe injuries are reported with a delay
San José residents live in a community with responsive emergency services and safe streets and roads.
Long-Term
Goal
Increasing Community Safety Focus Area
11 Blue: Complete
Green: On Track
Yellow: Needs Attention
Red: Off Track
Gray: Not Started
Goal 1.1 Police Marketing and Recruitment.
Goal 1.2 Police Report Transcription Pilot.
Goal 1.3 Police Patrol Deployment Projects.
Goal 1.4 Fire Station 32.
Goal 1.5 Fire Closest Unit Dispatch.
Goal 2.1 911-988 Call Transfer Program.
Goal 2.2 988 Community Education.
Goal 2.3 First Responder Fee Program.
1. Emergency Response.Problem
2. Crisis Response.Problem
3. Crime Reduction.Problem
4. Traffic Safety.Problem
Goal 3.1 Real-Time Intelligence Center.
Goal 3.2 Organized Retail Theft Detail.
Goal 3.3 Mission Street Recovery Station.
Goal 3.4 Proposition 36.
Goal 3.5 SJ Youth Empowerment Alliance.
Goal 4.1 Traffic Safety Projects.
Goal 4.2 Automated Traffic Enforcement.
/
Red Light Running /
Speed Enforcement
San José residents live in a community with responsive emergency services and safe streets and roads.
Long-Term
Goal
Increasing Community Safety Focus Area
Key Lessons Learned through Portfolio Retrospectives:
• Pilots have helped inform what can be scaled (e.g., two-officer units, district-wide dispatching) from what requires refinement or a different approach (police report transcription pilot). Meanwhile, other pilots are collecting evidence of early impact (e.g., SJYEA demonstration sites, first responder fee, red light running program)
• Long-term success will require strong interagency coordination for cross-jurisdiction efforts like crisis response, behavioral health, and solving crimes
• Budget uncertainties challenge progress for local initiatives like fire station expansion and automated speed enforcement program, while the City is also impacted by county and state budget uncertainties (e.g., Prop 36, Mission Street Recovery Station)
Reducing Unsheltered
Homelessness Focus Area
13 1. Shelter System Capacity & Operations. The City continues to face a shortfall in units and spaces despite recent expansion.Problem Goals Metrics Move toward functional zero in unsheltered homelessness by proactively and effectively managing the shelter system, increasing throughput into permanent housing, and improving data systems to guide investment.
Long-Term
Goal Indicators
2. Unsustainable Funding. The City’s shelter system lacks stable, long-term revenue sources.Problem Goals Metrics
3. Environmental Compliance & Public Spaces. Sustaining clean waterways and establishing No-Encampment Zones around Emergency Interim Housing sites remains difficult with limited shelter capacity.
Problem Goals Metrics
Reducing Unsheltered Homelessness Focus Area
4. Data & Forecasting Infrastructure. The City lacks consistent and reliable inflow-outflow data to forecast homelessness.Problem Goals Metrics 14 What’s going well. San José has made unprecedented investments to reduce unsheltered homelessness and its environmental impacts. The City has expanded shelter and safe parking capacity at record speed and sustained compliance on 26 miles of priority waterways, preventing re-encampments and reducing environmental discharge.
Main Challenges Moving Forward.
1. Shelter supply shortfall. Even with new shelter and safe parking sites coming online, overall demand far exceeds current capacity. Progress toward functional zero will depend less on building thousands of additional shelter beds and more on accelerating throughput from shelter into permanent housing. This work is closely tied to the City’s Building More Housing focus area.
2. Unsustainable funding. Operations remain heavily dependent on General Fund resources, with limited secured long-term revenue. Without more stable, ongoing funding, the shelter system cannot be sustained or reliably operated to support functional zero.
3. Displacement pressures. Enforcement along waterways has relocated individuals into new parts of the city, creating additional outreach and shelter needs. These pressures divert resources and disrupt progress toward system stability.
4. Data limitations. Gaps in real-time tracking of how many people are entering homelessness versus exiting into programs (inflow-outflow) slow efforts to forecast demand and manage the system proactively.
Move toward functional zero in unsheltered homelessness by proactively and effectively managing the shelter system, increasing throughput into permanent housing, and improving data systems to guide investment.
Long-Term
Goal
Context Indicators
# of New Units
Online
(705 by Calendar
Year 2025)
No-Encampment
Zones Maintained
≤ 65 re-
encampments/
quarter in waterway
NEZs;
Cost
Reduction
(up to 20% across
24 sites)
Forecasting Tool Updates
(quarterly, multi-department data)
15 Reducing Unsheltered Homelessness Focus Area
No-Encampment
Zones Maintained
≥ 80% of re-
encampments
resolved within NEZs
in 2 business days)
1. Shelter System Capacity and Operations.Problem
Context
Move toward functional zero in unsheltered homelessness by proactively and effectively managing the shelter system, increasing throughput into permanent housing, and improving data systems to guide investment.
Long-Term
Goal
16 Q1
Bristol
Hotel
47 Casa Linda
Hotel
34 Fontaine
Inn
52 Alura Hotel
42 Taylor
Street
North
56 Q2
Motel 6
76 Rue Ferrari
Expansion
108
Cherry Avenue
130
Q3
Cerone
162
Shelter Openings and # of Units, FY 2025 - 2026
Q1 Q2 Q3
Bringing multiple sites online at once
required tight cross department
coordination and highlighted the need
to standardize operating models.
The Cerone site, representing 162 units,
did not open as anticipated in December
due to delays in finalizing a required
security agreement with VTA.
Across the shelter portfolio, this work
highlighted the operational realities of
delivering multiple sites concurrently.
Reducing Unsheltered Homelessness Focus Area
17 Goal 1.1 Bring all planned 705 shelter units online by the end of Calendar Year 2025.
Goal 1.2 Standardize shelter system operations, budgets, and performance metrics across all 24 sites to decrease costs by up to 20% by June 2026.
Goal 1.3 Improve outreach & engagement tracking to increase placements into shelter, housing, and services.Goal 2.1 Sustain and stabilize diversified funding sources to reduce reliance on one-time or annual allocations.
Goal 2.2 Implement CalAIM billing for eligible services to sustain operations & reduce reliance on General Fund.
1. Shelter System Capacity and
Operations.Problem
2. Unsustainable Funding.Problem
3. Environmental Compliance and Public
Spaces.Problem
4. Data and Forecasting Infrastructure.Problem
Goal 3.1 Maintain environmental compliance in 26 miles of priority waterways & corridors by maintaining No-Encampment Zones (NEZs), limiting re-encampment and displacement impacts.
Goal 3.2 Maintain NEZs in public spaces around Emergency Interim Housing sites to limit re-encampment & ensure site accessibility.
Goal 4.1 Improve homelessness forecasting and reporting tools.
Goal 4.2 Strengthen HMIS data exchange with County and deploy new reporting tools.
Move toward functional zero in unsheltered homelessness by proactively and effectively managing the shelter system, increasing throughput into permanent housing, and improving data systems to guide investment.
Long-Term
Goal
Reducing Unsheltered Homelessness Focus Area
Blue: Complete
Green: On Track
Yellow: Needs Attention
Red: Off Track
Gray: Not Started
Key Lessons Learned through Portfolio Retrospectives
• Shelter Site Activation: Executing the development of shelter capacity requires coordinated delivery from many departments and contractors, resulting in schedule delays; complex partnerships can extend opening timeframes, requiring sustained coordination.
• Standardizing Operations: Policies, staffing models, and budgets change as system optimization is running parallel with system expansion with the final new sites coming online; cost savings take time to materialize because they require partner negotiations, contractual amendments, and alignment of operations to new contract provisions. • Building CalAIM Architecture: Building the infrastructure for medical billing and coding at sites to receive service expenditure reimbursements requires more reliance than anticipated on County infrastructure and further system integration.
• Shelter Capacity and Enforcement: Keeping priority areas clear can relocate people into other neighborhoods and increase vehicle habitation pressure, creating continuous operational redundancy for outreach, shelter, and field teams. • Tracking Outcomes: Data-sharing limits (including restrictions on law enforcement access) mean that teams, particularly the Enhanced Engagement Program Team (Housing Department) and the Neighborhood Quality of Life Team (Police Department), often need parallel systems, which may require system enhancements for clear data and outcome comparisons and reporting.
Move toward functional zero in unsheltered homelessness by proactively and effectively managing the shelter system, increasing throughput into permanent housing, and improving data systems to guide investment.
Long-Term
Goal
Reducing Unsheltered Homelessness Focus Area
Cleaning Up Our
Neighborhoods Focus Area
19 Cleaning Up Our Neighborhoods Focus Area
1. Blight on Private Property. Increasing case volumes, expanding scope, and static staffing for general funded positions stretches Code Enforcement’s ability to resolve complaints quickly.
Problem
2. Graffiti. The amount of graffiti the City removes has increased over the past 10 years.Problem
3. Illegal Dumping. The volume of illegal dumping collected by the City continues to increase.Problem
Goals Metrics
San José residents can enjoy a city with clean public spaces and well- maintained private property.
Long-Term
Goal Indicators
Goals Metrics
Goals Metrics
20 What’s going well. As of Q2 of 2025-2026, 52% of
residents reported that the City was clean, 73% that their neighborhood was clean, and 34% that Downtown was
clean, compared with 33%, 68% and 25% respectively in
Q1 2024.
Main Challenges Moving Forward. Increasing case
volumes, expanding scope, and static staffing for general funded positions stretches Code Enforcement’s ability to resolve complaints quickly. Volumes of graffiti eradicated and illegal dumping collected have increased steadily over time.
Cleaning Up Our Neighborhoods Focus Area
San José residents can enjoy a city with clean public spaces and well- maintained private property.
Long-Term
Goal
Context Indicator
21 0%
10%
20%
30%
40%
50%
60%
70%
80%
Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Q3 FY25 Q4 FY25 Q1 FY26 Q2 FY26 Cleanliness Perception
% of residents rating as "very clean" or "somewhat clean"
1.1 City Cleanliness Perception 1.2 Neighborhood Cleanliness Perception
1.3 Downtown Cleanliness Perception
Citywide Cleanliness Perception Neighborhood Cleanliness Perception Downtown Cleanliness Perception
1. Blight on Private Property. Problem
Context
San José residents can enjoy a city with clean public spaces and well- maintained private property.
Long-Term
Goal
22 Cleaning Up Our Neighborhoods Focus Area
0 50
100
150
200
250
300
Q1 FY26 Q2 FY26
Code Enforcement Average
Case Duration in Days
Code Enforcement is working to
implement recommendations from
the Operational Assessment
completed last fiscal year.
Code Enforcement capacity has been
stretched with increasing case
volumes, expanding scope, and static
staffing.
Implementing recommendations
from that assessment will be a
major focus in the is fiscal year.
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Q1 FY25 Q2 FY25 Q3 FY25 Q4 FY25 Q1 FY26 Q2 FY26
Percentage of Code Enforcement
Cases at Each Stage
7.1 Pre-Investigation 7.2 Investigation
7.3 Enforcement 7.4 Appeals Hearing Board
7.5 Compliance
Pre-Investigation Investigation
Enforcement Appeals Hearing Board
Compliance
2. Graffiti. Problem
Context
San José residents can enjoy a city with clean public spaces and well- maintained private property.
Long-Term
Goal
23 Cleaning Up Our Neighborhoods Focus Area
0 100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
Q1 FY25 Q2 FY25 Q3 FY25 Q4 FY25 Q1 FY26 Q2 FY26
Square Footage of Graffiti Removed by Quarter BSJ removes graffiti quickly and effectively.
Despite an effective removal
program, the volume of graffiti it
removes has grown steadily over
the past ten years.
We need to deter taggers from
making graffiti in the first place.
3. Illegal Dumping. Problem
Context
San José residents can enjoy a city with clean public spaces and well- maintained private property.
Long-Term
Goal
24 Cleaning Up Our Neighborhoods Focus Area
0 200
400
600
800
1,000
1,200
1,400
1,600
Q1 FY25 Q2 FY25 Q3 FY25 Q4 FY25 Q1 FY26 Q2 FY26
Illegal Dumping Tonnage Collected by Quarter Investments in BSJ have resulted in increase in illegal
dumping collection.
Though successful so far,
continuing to scale illegal dumping
collection is not sustainable.
We need to reduce the volume of
illegal dumping and optimize
operations to handle the high
volume.
25 Goal 1.1 Chronic Offender Resolution and Enforcement Pilot.
Goal 1.2 Escalated Enforcement Policy.
Goal 1.3 Phase 1 of CodeX.
Goal 1.4 Fine Study.
Goal 1.5 Downtown Enhanced Vacant Building and
Storefront Working Group.
Goal 2.1 Graffiti Enforcement and Diversion.
1. Blight on Private Property.Problem
2. Graffiti.Problem
3. Illegal Dumping.Problem
Goal 3.1 Illegal Dumping Enforcement.
Goal 3.2 Illegal Dumping Education.
Goal 3.3 Free Junk Pickup.
Goal 3.4 Trash and Debris Disposal.
Goal 3.5 Abandoned Shopping Carts.
Cleaning Up Our Neighborhoods Focus Area
San José residents can enjoy a city with clean public spaces and well-maintained private property.
Long-Term
Goal
Blue: Complete
Green: On Track
Yellow: Needs Attention
Red: Off Track
Gray: Not Started
Key Lessons Learned through Portfolio Retrospectives:
• Goal 2.1 Graffiti Enforcement and Diversion: In Q2 FY 2025-2026, Detectives investigated 90 new cases and authored over 100 arrest and search warrants, resulting in 10 arrests, building on the 14 arrests in Q1. One notable Q2 investigation led to a significant enforcement action, including the seizure of a loaded firearm, two homemade improvised explosive devices (IEDs), and narcotics, highlighting the broader public safety impacts of graffiti enforcement efforts. • Goal 3.3 Free Junk Pickup: Multifamily hauler has conducted outreach in 20% of targeted multifamily areas identified by BeautifySJ staff as opportunity areas to reduce illegal dumping and is continuing to work through the remaining areas. The program collected 580 tons from multifamily complexes in Q2 of FY 2025-2026, compared with 485 tons in the same period in FY 2024-2025. This continues the trend from Q1 of FY 2025-2026, when 661 tons were collected from multifamily complexes compared with 464 in Q1 of FY 2024-2025. The enhanced outreach to multifamily complexes has been successful at increasing usage of the service.
• Goal 3.5 Abandoned Shopping Carts: Staff completed the shopping cart collection pilot program in Q2 of FY 2025-2026.
The pilot program collected 734 carts over three months. The pilot highlighted the significant number of carts that could be collected if a permanent program were established. It also demonstrated that collecting data on which retailers’ carts were collected could help reveal the sources of abandoned carts.
Cleaning Up Our Neighborhoods Focus Area
San José residents can enjoy a city with clean public spaces and well-maintained private property.
Long-Term
Goal
Building More Housing
Focus Area
27 1. Land Use, Policy, and Regulation.Land use and housing policies are complex with many stakeholders and quality of life goals.
Problem Goals Metrics
Meet resident’s housing needs across income levels by making San José a great place to build housing.Long-Term
Goal Indicators
2. Development Services Process. There is an opportunity to streamline and improve analysis and communication
of our development services process.
Problem Goals Metrics
3. Linking Land and Capital. There is an opportunity to align land use and housing policies with market feasibility.Problem Goals Metrics Building More Housing Focus Area
28 Meet resident’s housing needs across income levels by making San José a great place to build housing.
Long-Term
Goal
Indicators
29 Building More Housing Focus Area
0 400
800
1200
1600
2000
2400
2800
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
Market Rate Affordable
Housing Units Entitled
0 400
800
1200
1600
2000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
Market Rate Affordable ADU
Building Permit Issued
Quarterly RHNA Target: 1,944
0 400
800
1200
1600
2000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
Market Rate Affordable ADU
Certificate of Occupancy
Since City Council approved the multifamily housing incentive program in December 2024, 1,444 units have moved from entitlement to construction, however, there are still not enough units being built.
Note: Quarterly data is based on the fiscal year calendar 30 Goal 1.1 General Plan 4-Year Review.
Goal 1.2 Downtown Ministerial.
1. Land Use, Policy, and Regulation.Problem
2. Development Services Process.Problem
3. Linking Land and Capital.Problem
Goal 3.1 Cost of Development Study Session.
Goal 3.2 Financial Feasibility.
Goal 3.3 Financing Programs.
Goal 3.4 Alternative Financing Programs.
Meet resident’s housing needs across income levels by making San José a great place to build housing.
Long-Term
Goal
Goal 2.1 Performance Management.
Goal 2.2 CEQA Standard Conditions.
Goal 2.3 CEQA Streamlining.
Goal 2.4 Development Fee Estimator.
Building More Housing Focus Area
Blue: Complete
Green: On Track
Yellow: Needs Attention
Red: Off Track
Gray: Not Started
Key Lessons Learned through Portfolio Retrospectives:
• Most housing proposals are not financially feasible right now. As a result, projects moving forward will largely depend on the City’s incentive programs.
• While the City is meeting building permit timelines for affordable housing, that prioritization is extending timelines for market-rate and other development projects. • Ongoing state requirements are limiting staff capacity to advance proactive, locally-driven housing policy work.
Meet resident’s housing needs across income levels by making San José a great place to build housing.
Long-Term
Goal
Building More Housing Focus Area
Growing Our Economy
Focus Area
32 1. Business Development and Workforce Preparedness.To remain competitive, San José must strengthen engagementwith key growth industries and prepare local talent for the jobs of the future.
Problem Goals Metrics
Cultivate an ecosystem for thriving businesses and resident prosperity.Long-Term
Goal Indicators
2. Infrastructure Readiness. Companies need infrastructure that enables them to succeed.Problem Goals Metrics
3. Downtown and Neighborhood Business Districts
Investment. When Downtown thrives, San José thrives.
Neighborhood business districts drive shared prosperity and placemaking citywide.
Problem Goals Metrics
Growing Our Economy Focus Area
4. Sports and Entertainment District Development. There is an opportunity to activate San José as the South Bay's hub for sports and entertainment.
Problem Goals Metrics
33 Growing Our Economy Focus Area
Cultivate an ecosystem for thriving businesses and resident prosperity.
Long-Term
Goal
Indicators
Small Businesses
Data in process
with the Finance
Department
34 100,000
200,000
300,000
400,000
500,000
Jobs
$0
$100,000,000
$200,000,000
$300,000,000
$400,000,000
$500,000,000
$600,000,000
FY22 FY23 FY24 FY25 FY26
Tax Revenue
Property Tax Sales Tax Utility Tax
0%
10%
20%
30%
40%
50%
60%
Q1 FY24
Q2 FY24
Q3 FY24
Q4 FY24
Q1 FY25
Q2 FY25
Q3 FY25
Q4 FY25
Q1 FY26
Q2 FY26
Downtown Vibrancy
0 1
2 3
4 2018 2019 2020 2021 2022 2023 2024
Income Inequality
Budgeted
Data Highlights
• +31k jobs since 2020, but below pre-
pandemic peak
• Downtown Vibrancy +8% since FY2024
• 20th percentile earner would need to more
than triple their income to enter the middle
class (60
th percentile)
35 Goal 1.1 Job Attraction and Retention.
Goal 1.2 Employer Engagement.
Goal 1.3 Jobs Data Analysis.
Goal 1.4 Unstably Housed Workforce Development.
Goal 1.5 AI Training.
Goal 1.6 AI Tool.
1. Business Development and Workforce
Preparedness.Problem
2. Infrastructure Readiness. Problem
3. Downtown and Neighborhood
Business District Investment.
Problem
Growing Our Economy Focus Area
Cultivate an ecosystem for thriving businesses and resident prosperity.
Long-Term
Goal
Goal 2.1 Energy Access.
Goal 2.2 Projects in Development Pipeline.
Goal 2.3 Projects in Development Pipeline.
Goal 2.4 Wastewater Economic Development Lands.
Goal 2.5 LS Power Permit.
Goal 3.1 Downtown Commercial Lease Renewal.
Goal 3.2 Downtown Commercial Attraction.
Goal 3.3 Downtown Placemaking.
Goal 3.4 Business Improvement District Formation.
Goal 3.5 Small Business Grants.
Goal 3.6 Small Business Streamlining.
4. Sports and Entertainment District
Development.
Problem
Goal 4.1 Sports and Entertainment District.
Goal 4.2 Convention Center Expansion.
Goal 4.3 Entertainment Zones.
Goal 4.4 2026 Special Events.
Goal 4.5 City-wide Special Events.
Goal 4.6 Economic Impact Measurement.
Blue: Complete
Green: On Track
Yellow: Needs Attention
Red: Off Track
Gray: Not Started
Key Lessons Learned through Portfolio Retrospectives:
• Focus on data center projects will generate revenue for the City. Estimated $2.1 million in utility tax revenue generated by data center/large energy projects in FY 2026-2027. • Staff will surpass goal for business improvement district formation. The small business start-up grant program has generated a lot of interest with over 250 applications to date. • SJ26 is a momentum builder for Downtown placemaking, events, and business attraction and retention. Four Downtown business attractions secured through Q2 including Poppy & Claro, the VTA Security Building, West Coast Community Bank, and Lucid Motors.
Growing Our Economy Focus Area
Cultivate an ecosystem for thriving businesses and resident prosperity.
Long-Term
Goal
What’s Next?
Focus Areas and the FY 2026-2027 Budget Process
January
Embedding Focus Area discussion into the Budget Process to ensure co-creation of strategies aimed to meet our Long-Term Goals Mayor’s March Message.
Direction given through the Message will
inform exploration/scoping of future focus area
work, which may include problem areas or
specific change initiatives for FY 2026-2027.
Any contemplated changes for the following
fiscal year should be explored in this context.
City Manager’s Proposed Budget.
The Administration may propose change
initiatives for FY 2026-2027, stemming from
learnings derived from current year’s
execution.
February March
April May June
June Budget Message.
Through the adoption of the June Budget
Message, the City Council will formally adopt
Focus Area workplans for FY 2026-2027.
Priority Setting.
Staff will embed Focus Areas into the 2026-
2027 Preliminary General Fund Forecast and
Budget Priorities Study Session to cultivate a
discussion that supports the City Council
articulating its priorities (given budget
constraints and required reductions) in
advance of the Mayor’s March Message.
Budget Study Session.
The Administration will embed Focus Area
learnings into a Budget Study Session.
Manager’s Budget Addendum (MBA).
The Administration will publish an MBA that
summarizes all feedback/ideas contemplated
through the budget process and establishes a
recommended Focus Area structure and
process for FY 2026-2027.
37 Mid-Year Budget Review Report.
Review and approval by the City Council.
Item 3.4: Second Quarter City Council
Focus Area Status Report for Fiscal Year
2025-2026
San José City Council March 10, 2026
City of San José
City Manager’s Office
Lee Wilcox, Assistant City Manager, Reducing Unsheltered Homelessness Jennifer Schembri, Deputy City Manager, Increasing Community Safety Angel Rios, Deputy City Manager, Cleaning Up Our Neighborhoods Rosalynn Hughey, Deputy City Manager, Building More Housing and Growing Our Economy Erik Jensen, Deputy Director, City Manager’s Office
38