COUNCIL AGENDA: 4/28/26
FILE: 26-470
ITEM: 3.5
TO: HONORABLE MAYOR
AND CITY COUNCIL
FROM: Maria Öberg
Erik L. Soliván
SUBJECT: See Below DATE: April 6, 2026
Approved Date:
4/14/2026
COUNCI
L DISTRICT: Citywide
SUBJ
ECT: Amendments to City Council Policy 1-16, Policy for the Issuance of Multifamily Housing Revenue Bonds
RECO
MMENDATION
Adopt
a resolution amending City Council Policy 1-16, Policy for the Issuance of Multifamily Housing Revenue Bonds.
SUM
MARY AND OUTCOME
The pr
oposed policy revisions will streamline and modernize City Council Policy 1-16, Policy for the Issuance of Multifamily Housing Revenue Bonds (Policy), to reduce administrative burden for affordable housing developers and improve staff’s ability to efficiently process bond transactions while maintaining compliance with applicable federal and state requirements.
BA
CKGROUND
The C
ity Council adopted the Policy in 2002 to facilitate the development of affordable housing in the City of San José (City) and to address bond financing-related matters, including permitted issuers, the City’s financing process, City fees, credit considerations, and refunding or restructuring of outstanding bonds. On April 29, 2025, City Council approved amendments to the Policy and directed staff to return with a more comprehensive review to ensure it reflects current industry practices and the City’s affordable housing production goals.
I
n response to City Council direction, staff conducted a comprehensive evaluation of the existing bond policy, including a review of procedural requirements, market standards,
HONORABLE MAYOR AND CITY COUNCIL
April 6, 2026
Subject: Amendments to City Council Policy 1-16, Policy for the Issuance of Multifamily Housing Revenue Bonds
and internal administrative processes. This assessment identified opportunities to simplify policy language, eliminate duplicative or outdated provisions, consolidate procedural requirements, and provide clearer authority for staff to administer the program efficiently. The resulting amendments are intended to modernize the Policy, improve clarity for developers, and allow staff to more effectively support time-sensitive affordable housing developments while maintaining appropriate oversight and compliance protections.
ANALYSIS
The proposed amendments are designed to improve clarity, streamline the bond issuance process, and enhance staff flexibility while maintaining appropriate financial and compliance safeguards. Key updates are summarized below.
Streamlined Structure and Modernized Organization
The amended Policy consolidates and reorganizes content to improve readability and provide clarity. Procedural steps will be shifted into an administrative procedures document, allowing staff to make process-based updates more quickly and ensuring the program can adapt efficiently in a fast-changing housing investment environment.
Reduced Barriers for Affordable Housing Developers
The updated Policy clarifies readiness requirements, the selection process for the financing team, and the treatment of private placements and alternative financing structures. These revisions are intended to create greater consistency and remove unnecessary administrative barriers, benefitting affordable housing developments with competitive funding deadlines.
Updated Eligibility, Prioritization, and Compliance Requirements
The amendments modernize development eligibility standards, clarify the permitted uses of bond proceeds, and update prioritization criteria to align with the City’s affordable housing goals, including developments that leverage substantial non-City subsidy, preservation of at-risk affordable units, and permanent supportive housing.
Compliance requirements are updated to preserve the City’s oversight role, while not creating undue administrative burden.
HONORABLE MAYOR AND CITY COUNCIL
April 6, 2026
Subject: Amendments to City Council Policy 1-16, Policy for the Issuance of Multifamily Housing Revenue Bonds
EVALUATION AND FOLLOW-UP
If approved, staff will update all internal procedures, forms, and timelines to conform to the amended Policy. Additionally, Finance and Housing Department staff will continue to review the Policy periodically to ensure consistency with the City's debt management objectives and industry standards relating to the issuance of multifamily housing revenue bonds, and to maintain compliance with federal and state regulatory requirements.
Staff from the Finance and Housing Departments will be available to answer questions about the Policy at the City Council meeting on April 28, 2026.
COORDINATION
This memorandum has been prepared in coordination with the City Attorney’s Office and the City Manager’s Budget Office.
PUBLIC OUTREACH
This memorandum will be posted on the City Council Agenda website for the April 28, 2026 City Council meeting.
BOARD, COMMISSION, COMMITTEE RECOMMENDATION AND INPUT
No board, commission, or committee recommendation or input is associated with this action.
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 6, 2026
Subject: Amendments to City Council Policy 1-16, Policy for the Issuance of Multifamily Housing Revenue Bonds
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/
Maria Öberg Erik L. Soliván
Director, Finance Department Director, Housing Department
For questions, please contact Qianyu Sun, Deputy Director of Finance – Debt and Treasury Management, at [email protected] or Banu San, Deputy Director, Housing Department, at [email protected] or.