TO: HONORABLE MAYOR
AND CITY COUNCIL
FROM: Emily S. Lam
SUBJECT: See Below DATE: August 24, 2026
Approved Date:
9/4/26
CO
UNCIL DISTRICT: Citywide
S
UBJECT: City Council Focus Area Annual Report for Fiscal Year 2025-2026 RE
COMMENDATION
A
ccept the annual report on the City Council Focus Areas for Fiscal Year 2025-2026.
S
UMMARY AND OUTCOME
F
or the reporting period of Fiscal Year 2025-2026, the Mayor and City Council will understand the status and lessons learned through execution of the following City Council Focus Areas (Focus Areas):
• I
ncreasing Community Safety.
• Reducing Unsheltered Homelessness.
• Cleaning Up Our Neighborhoods.
• Growing Our Economy.
• Building More Housing.
BACKG
ROUND
On S
eptember 30, 2025, the City Council approved the Fiscal Year (FY) 2025-2026 Focus Area work plans developed under a new model. This framework is designed to strengthen and accelerate progress on San José’s most significant, cross-cutting challenges.1
1See September 30, 2025, City Council, Item 3.4, City Council Focus Areas Semi-Annual Status Report. https://sanjose.legistar.com/View.ashx?M=F&ID=14796341&GUID=F10DEA6B-E69E-4648-A366- E7C99FB38D05
COUNCIL AGENDA: 9/15/26
FILE: 26-948
ITEM: 3.4
HONORABLE MAYOR AND CITY COUNCIL
August 24, 2026
Subject: City Council Focus Area Annual Report for Fiscal Year 2025-2026
The Focus Areas represent a major shift from data reporting to a shared learning model, structured through quarterly cycles of planning, executing, reflecting, and improving.
Each Focus Area is supported by a logic model (a framework linking long-term goals to near-term actions and measurable results) and by a regular cadence of retrospective learning sessions that enable teams to adjust strategies in real time and report insights to the City Council.
T
he purpose of the Focus Areas is to promote accountability for driving positive outcomes and performance on a very limited number of priorities most greatly impacting the community, and to generate actionable and measurable solutions to address those priorities. Each Focus Area is not designed to include all related City services, though each varies in breadth and complexity. Staff currently provide quarterly status reports on the Focus Areas alternating between the City Council and the aligned City Council Committee. Staff last reported on the Focus Areas (Third Quarter Status Report) to City Council Committees during June 2026.
2 City Council approved the work plans for the
current fiscal year via Manager’s Budget Addendum #8, Fiscal Year 2026-2027 Focus Area Work Plans.3
ANAL
YSIS
The A
dministration’s lessons learned from this foundational work will be reported on during the City Council item, presented by each Focus Area Executive Sponsor or designee. The presentation will include a brief reminder of the long-term goal and near- term fiscal year goals, a summary of progress to date drawing from retrospectives, key lessons learned, and next steps to strengthen implementation. These retrospective updates are shown for each Focus Area in the following attachments:
• A
ttachment A: Increasing Community Safety.
• Attachment B: Reducing Unsheltered Homelessness.
• Attachment C: Cleaning Up Our Neighborhoods.
• Attachment D: Growing Our Economy.
• Attachment E: Building More Housing.
F
ocus Area Performance Learning Trends and Insights
I
n addition to the problem area and goal-level progress summarized in the attachments, the following provides a higher-level view of the overall health and direction of each Focus Area. The storylines below highlight the most notable themes emerging from long-term indicators and other available data, with an emphasis on meaningful trends and insights. Further insights gathered through the Focus Area Community Survey 2 June 2026 Committee Updates. Increasing Community Safety, Reducing Unsheltered Homelessness, Cleaning Up Our Neighborhoods, Growing Our Economy, and Building More Housing. 3 https://www.sanjoseca.gov/home/showpublisheddocument/131494/639142042464530000
HONORABLE MAYOR AND CITY COUNCIL
August 24, 2026
Subject: City Council Focus Area Annual Report for Fiscal Year 2025-2026
Annual Report can be discovered through an interactive dashboard created and published by City staff.4 Full Focus Area Community Survey results can be found in the 2026 Summary Annual Report in Attachment F.
Increasing Community Safety: Overall, the Increasing Community Safety Focus Area is trending in a positive direction, with sustained improvements in residents’ sense of safety and reductions across major crime rate categories. Core emergency response performance remains stable, while traffic safety and the intersection between public safety and homelessness highlight areas that require sustained attention.
• Residents are feeling safer across the community. Perceptions of safety improved by five percentage points each for citywide, neighborhood, and downtown locations. Resident experiences indicate that the biggest remaining safety challenges relate to downtown and homelessness concerns. • Emergency response performance remains stable, with a strong foundation for scaling early solutions. Positive trends in police staffing are expected to improve future response times. These trends include slowly recovering academy sizes and increased lateral hiring, along with strengthened foundations for patrol deployment. Additional future operational opportunities include continued refinement of the Police Department’s report transcription pilot and the Fire Department’s closest-unit dispatch pilot, while the deferral of the opening of Fire Station 32 remains a constraint.
• Crime rates declined across all three major categories. Year-over-year, Crimes Against Persons decreased by 7%, Crimes Against Property decreased by 6%, and Crimes Against Society decreased by 5%. While crime trends are influenced by many factors, the consistency of these reductions (overall crime rates have decreased in all three years of Focus Area reporting), alongside improving perceptions of safety, suggests that the City’s efforts are contributing to positive community safety outcomes.
• Traffic safety remains stable, with opportunities for future improvement.
Traffic fatalities and killed or severely injured (KSI) events were somewhat elevated in FY 2025-2026, although results remain generally consistent with levels observed over the past three years. San José recorded 49 traffic fatalities during FY 2025-2026, compared with 40 in the prior year. From July through December 2025, 140 KSI events were recorded, compared with 125 during the same period the prior year.
5 Reducing Unsheltered Homelessness: San José closed FY 2025-2026 with meaningful progress in the capacity, operating systems, and data infrastructure needed to reduce unsheltered homelessness, while residents reported a measurable decline in how frequently they encounter homelessness in their neighborhoods. At the same time, the year’s results reinforced that shelter expansion is one of several tools needed to
4 https://2026-focus-area-survey-cosj.replit.app/#overview 5 Note that KSI data is reported with a six-month lag.
HONORABLE MAYOR AND CITY COUNCIL
August 24, 2026
Subject: City Council Focus Area Annual Report for Fiscal Year 2025-2026
achieve functional-zero for unsheltered homelessness. With the major planned shelter expansion complete, the next phase shifts from building the system to managing flow through it, with greater emphasis on City-County coordination, shelter-to-housing throughput, sustainable operations, public-space movement, and regional accountability.
• Shelter expansion materially changed the system’s capacity to bring people indoors. The City completed its planned expansion with 707 shelter units against the original 705-unit target. Following portfolio refinements, the active shelter system included approximately 1,820 units, 2,202 beds, and 22 sites.
With this expansion complete, the standalone site-opening initiative is transitioning to ongoing operations.
• Residents are reporting less frequent exposure to homelessness in their neighborhoods. In FY 2025-2026, 53% of residents reported encountering people experiencing homelessness in their neighborhood at least weekly, down from 63% in FY 2024-2025 and 68% in FY 2023-2024. Daily encounters declined from 41% to 30% year-over-year, a statistically significant improvement.
However, with more than half of residents still reporting encounters at least weekly, homelessness remains highly visible in the community. • FY 2025-2026 also established infrastructure for more active management of the remaining unsheltered population. The City developed the Dynamic Homelessness Insights Model, migrated Homeless Management Information System (HMIS) and Salesforce data into the approved City data environment, and advanced shelter inventory and reporting tools. These capabilities are now transitioning into standard operations and will support more frequent measurement of the unsheltered baseline, system flow, and placement pathways.
• The Focus Area update points to a different management challenge for FY 2026-2027. With significantly more shelter capacity in place, the updated Focus Area will concentrate on improving shelter operations and management practices, strengthening City-County service coordination, increasing movement from shelter to permanent placements, sustaining the shelter system, reducing repeated movement across public spaces, and defining and tracking a functional- zero baseline that accounts for regional flow and downtown concentration.
Cleaning Up Our Neighborhoods: In FY 2025-2026, staff advanced efforts to improve the cleanliness of the City across three domains: blight on private property, graffiti, and illegal dumping. For blight on private property, the Code Enforcement Division within the Planning, Building, and Code Enforcement Department advanced a range of efforts to improve the speed and efficacy of its enforcement efforts. For graffiti, the Police Department implemented a graffiti enforcement detail that pursued cases against prolific taggers. For illegal dumping, BeautifySJ, the Environmental Services Department, Code Enforcement Division, the City Attorney’s Office, and the Police Department collaborated to channel residents into legal avenues for waste disposal and deter and enforce against illegal dumpers.
HONORABLE MAYOR AND CITY COUNCIL
August 24, 2026
Subject: City Council Focus Area Annual Report for Fiscal Year 2025-2026
• Resident perception of cleanliness has improved. Resident perception of the City’s cleanliness has improved substantially over the past year. Over FY 2024- 2025, 39.7% of residents rated San José clean or very clean, while over FY 2025-2026, it increased to 50%. Survey data indicates that the top two contributing factors to perceptions that the city is unclean are litter around the city and homelessness, suggesting that efforts to address both issues could be contributing to the improved perception.
• Code Enforcement Division cases are moving from investigation to enforcement. Code Enforcement is advancing a range of process improvements and pilot programs to make enforcement more rapid and effective. Code Enforcement evaluates the effectiveness of these efforts in part by looking at the number of cases in each process stage, from investigation to enforcement.
Comparison of data from FY 2024-2025 to FY 2025-2026 shows a decrease in the proportion of cases in the investigation and notice stages and an increase in the proportion of cases in the formal enforcement stages. • Graffiti eradication is up overall, while gang and offensive graffiti declined.
As part of its dedicated enforcement efforts, the Police Department identified 70 graffiti suspects and made 15 arrests in FY 2025-2026, compared to three arrests made in FY 2024-2025. Despite increased enforcement, the overall amount of graffiti eradicated by the City increased in 2025-2026 by 11%. This increase may have a number of causes, including efforts to prepare for SJ2026 events such as the Super Bowl LX, March Madness, and FIFA World Cup, pilot efforts to increase proactive graffiti eradication and restoration within parks in City Council District 5, increased proactive gang graffiti eradication in targeted neighborhoods, and collaboration with Union Pacific Railroad to abate graffiti along railway soundwalls. Despite the overall increase, it is important to note that gang-related, hate, and offensive graffiti declined from 442,125 square feet in FY 2024-2025 to 429,283 square feet in FY 2025-2026, a 2.9% decrease. • Illegal dumping declined slightly. BeautifySJ removed 14 million pounds of trash and litter through illegal dumping response and neighborhood litter removal efforts in 2025-2026, a 1.8% decrease from FY 2024-2025. This decrease comes in the context of concerted efforts by staff to enforce against illegal dumpers while at the same time making legal means of disposing of waste more convenient. The Blight Enforcement Working Group, an interdepartmental team formed to coordinate enforcement against illegal dumping through the use of cameras, succeeded at issuing 104 citations and 148 warning letters to illegal dumpers, a 580% increase in enforcement referrals over the previous year.
Environmental Services Department staff worked with the City’s solid waste contractor to increase Junk Pickup program outreach to multifamily complexes, resulting in a 30% year-over-year increase in Junk Pickup tonnage collected from multifamily residents.
HONORABLE MAYOR AND CITY COUNCIL
August 24, 2026
Subject: City Council Focus Area Annual Report for Fiscal Year 2025-2026
Growing Our Economy: Overall, the Growing Our Economy Focus Area is trending in a positive direction, having exceeded nearly every target across job creation, infrastructure readiness, downtown business investment, and major event programming, while resident sentiment toward downtown vibrancy showed measurable, statistically significant improvement.
• Business Development and Workforce Preparedness delivered from both ends, growing jobs through targeting employer engagement while building the workforce infrastructure and AI-driven tools to prepare residents for those roles. The team retained, expanded, or attracted 6,559 jobs against a goal of 5,000, by targeting partnerships with employers like Advantest, Astera Labs, Cisco, Nokia, and SK Hynix. On the workforce side, intensive case management and staff training helped the unstably housed residents pilot hit its 125-participant enrollment goal, with 65% of those employed placed into high- wage, high-growth employment. Lastly, work3future’s paid AI-related work experience training pilot enrolled 95 young adults. In addition, over 500 participants enrolled in the various AI workshops offered. • Large-scale power projects have been energized and projects have been moved through the pipeline creating capacity for attracting innovative businesses. Two of three targeted power projects were completed on schedule (the third delayed due to unmarked underground utilities). Three projects submitted building permits and five entered planning entitlement, and secured an Exclusive Negotiating Agreement with Prologis for the Regional Wastewater Facility lands, positioning the City for future investment. • New Business Improvement Districts expanded investment in commercial corridors citywide. Four new Business Improvement Districts, including Story Road BID, Alum Rock BID, The Alameda BID, and the East Village, were approved by City Council and are now providing funding to businesses to collectively invest in their neighborhoods (street cleaning, marketing, etc.) • Overall resident sentiment towards downtown as a place residents enjoy visiting has significantly improved, as well as entertainment. Downtown foot traffic increased 8.6% overall compared to the prior fiscal year (day-time traffic up
8.1%, night-time up 13.7%), suggesting that business gains and events are translating into more people on the ground in downtown. The 12 completed placemaking initiatives and record outdoor event programming track with the single largest, statistically significant survey gain for enjoyment of visiting downtown San José (from 49.6% in FY 2024-2025 to 53.1% in FY 2025-2026) as well as rising agreement that downtown is a good place for entertainment (from
58.9% in FY 2024-2025 to 61% in FY 2025-2026).
• Major sporting events drove visitation and economic activity. Super Bowl week drew approximately 459,200 unique Downtown visitors, up nearly 25% year-over-year, with hotel revenue increasing 107%. March Madness attracted more than 46,000 spectators, and preliminary World Cup results showed one million cumulative visits to San Pedro Square over 39 days, with hotel RevPAR up 28% during the tournament period. The NVIDIA GTC conference brought in
HONORABLE MAYOR AND CITY COUNCIL
August 24, 2026
Subject: City Council Focus Area Annual Report for Fiscal Year 2025-2026
approximately 360,000 downtown visits, a 16.2% year-over-year increase, including 35,942 event-related visitors, a nearly 78% increase from 20,224 in 2025, with out-of-state event-related visitation up 50.9% and visitors traveling from 956 ZIP codes nationwide. Lastly, the Entertainment Zone program delivered 52 activations citywide supporting the FIFA World Cup programming.
B
uilding More Housing: Overall, the housing market continues to be challenging due to a range of factors, including broader economic and market forces beyond the City’s control that contribute to high land, construction, and financing costs. The City’s efforts, however, have been helping address the factors within its control across multiple fronts, including advancing land use policy through the General Plan 4-Year Review, streamlining development review processes, and expanding incentive and financing tools informed by new market research.
En
titlements have decreased, 3,232 in FY 2025-2026 compared to 4,798 in FY 2024- 2025, showing the pipeline of activity is well below the rate needed to keep pace with Regional Housing Needs Allocation targets (7,775 per year). Building permit activity increased substantially, three folds, from 1,087 in FY 2024-2025 to 4,467 in FY 2025- 2026, suggesting that incentive programs are helping move projects from entitlement into the building permit stage. Certificates of occupancy decreased slightly overall (1,034 in FY 2025-2026 compared to 2,031 in the previous fiscal year), suggesting that projects are still making their way through the pipeline. • C
ity incentive programs have created movement through the housing production pipeline. Based on staff's analysis of the effectiveness of the City's market-rate housing incentive and affordable financing programs, presented to City Council in January 2026, the City Council extended and expanded the Multifamily Housing Incentive Program and launched a new Downtown Conversion Program to support the adaptive reuse of commercial space for residential housing. As of July 2026, the Multifamily Housing Incentive Program has supported 2,697 units across eight projects currently under construction, including 286 deed-restricted affordable units (approximately 11% of the total), serving households earning up to 110% Area Median Income (AMI). In March 2026, the City Council approved participation in the Downtown Residential Incentive Program for two developments, the Bank of Italy (Office-to-Residential Conversion) and Gateway Tower (New Construction), with 109 and 220 residential units, respectively. The Bank of Italy development is currently under construction, while Gateway Tower's construction is anticipated to begin in fall 2026.
• Alternative financing helped preserve residential units, reducing costs for developers. A total of 197 units have been preserved with one residential building through alternative financing and public-private partnership tools, including assets from a nonprofit serving extremely low-income households and distressed market-rate assets restricted to affordable rents. These efforts made it
HONORABLE MAYOR AND CITY COUNCIL
August 24, 2026
Subject: City Council Focus Area Annual Report for Fiscal Year 2025-2026
possible to create affordability more quickly and at significantly lower cost than traditional, new affordable housing construction.
• The General Plan 4-Year Review established a policy framework to increase residential capacity, expand housing options, simplify the Urban Village strategy, and maintain the City’s jobs-to-employed-residents balance. The framework raises residential capacity through higher density limits, corridor and commercial redesignation, and new Public/Quasi-Public housing pathways. The framework also enables missing middle and small multifamily housing citywide by increasing single-family zoning from eight to 32 units per acre with a streamlined ministerial approval path. Finally, it consolidates and simplifies the Urban Village strategy and maintains a 1.1 jobs-to-employed residents ratio. The framework was developed through a streamlined review process that used the Planning Commission as the review body and included eight meetings over nine months and a joint City Council/Planning Commission Study Session. The City Council approved the policy framework scope in August 2026 with direction to modify the following: minimum parking standards, environment review alternatives, local density bonus program evaluation, pilot expansion for Missing Middle housing program, ordinance changes to facilitate 100% affordable housing on Public/Quasi-Public lands, amendments to South Side Community Center, neighborhood commercial allowance exploration in residential neighborhoods, and cycle addition for privately-initiated General Plan amendments. • The Environmental Review Handbook and Environmental Standard Permit Conditions were adopted on May 19, 2026. At least three projects have used the handbook and were approved through the Director’s Hearing in July 2026.
This reflects early-stage implementation of the policy, which has not yet reached full operational status.
Evaluation Approach
This Focus Area Annual Report introduces a new performance evaluation approach developed in partnership with Dr. Shannon Arvizu and the University of California, Berkeley Goldman School of Public Policy. The framework is intended to strengthen the City's ability to evaluate strategic initiatives by moving beyond reporting activities completed to understanding what worked, what was learned, and how those insights should inform future decisions. Staff developed evaluation principles core to a performance learning system:
• Principle 1: Evaluate hypotheses, not just metrics.
• Principle 2: Connect action to outcomes.
• Principle 3: Measure progress at multiple levels.
• Principle 4: Use evaluation to drive adaption.
Rather than focusing solely on whether projects were completed, the framework evaluates each Focus Area goal through three complementary questions:
HONORABLE MAYOR AND CITY COUNCIL
August 24, 2026
Subject: City Council Focus Area Annual Report for Fiscal Year 2025-2026
• How Much Did We Do? (Operational Measures) Measures the scale of implementation by assessing outputs such as activities completed, projects delivered, services provided, or participants served.
• How Well Did We Do It? (Success Measures) Evaluates the quality, efficiency, timeliness, and effectiveness of implementation using performance measures. • What was the Impact? (Contributions to Long-Term Indicators) Examines how each initiative appears to contribute to broader community outcomes and long- term Focus Area objectives, recognizing that many outcomes are influenced by multiple factors.
Each goal is accompanied by an evaluation that summarizes the original goal and change initiative, the hypothesis that guided implementation, completion status, results and lessons learned, and recommended next steps for the change initiative, including whether it should be operationalized, refined, or concluded. This emphasis on learning is intended to help the City refine strategies, allocate resources more effectively, and continuously improve results for residents over time. Completion status for each near- term goal is reported according to the following criteria:
• Completed: The goal has been fully achieved or exceeded. • Partially Completed: The goal has been partially met. • Not Completed: The goal was not achieved.
• On Hold: The goal has been deferred.
What Comes Next?
City staff continue to build capacity for implementing Focus Area work plans in the near- term while also building the long-term culture and mindsets that sustain it. Some of these practices continue to be refined through the following:
• Regular Focus Area portfolio retrospectives to sustain learning and adaptation. • Quarterly Focus Area status reports alternating between City Council and City Council Committees as directed by City Council. Note that FY 2026-2027 Focus Area work plan status reports will be heard during the December 2026 City Council Committee meetings for the Public Safety, Finance and Strategic Support Committee, the Neighborhood Services and Education Committee, and the Community and Economic Development Committee.
• Public transparency and accountability via quarterly refreshes of the Focus Area Dashboards on the City’s website.
6 Refinement work continues via user testing.
• The FY 2027-2028 Budget process, starting with the Priority-Setting Study Session expected in winter 2027 and culminating in a FY 2027-2028 Focus Area work plan that is approved by the City Council in June 2027.
6 https://www.sanjoseca.gov/your-government/departments-offices/office-of-the-city-manager/city-council- focus-areas
HONORABLE MAYOR AND CITY COUNCIL
August 24, 2026
Subject: City Council Focus Area Annual Report for Fiscal Year 2025-2026
EVALUATION AND FOLLOW-UP
Staff will provide status reports through City Council Committees in December 2026.
COORDINATION
This memorandum was coordinated with the City Attorney’s Office, City Manager’s Budget Office, City Manager’s Office of Economic Development and Cultural Affairs, Environmental Services Department, Fire Department, Housing Department, Information Technology Department, Parks, Recreation, and Neighborhood Services Department, Planning, Building and Code Enforcement Department, Police Department, and the Transportation Department.
PUBLIC OUTREACH
This memorandum will be posted on the City Council Agenda website for the September 15, 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. PP17-009, Staff Reports, Assessments, Annual Reports, and Informational Memos that involve no approvals of any City action.
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.
Emily S. Lam
Director, City Manager's Office of
Administration, Policy, and
Intergovernmental Relations
HONORABLE MAYOR AND CITY COUNCIL
August 24, 2026
Subject: City Council Focus Area Annual Report for Fiscal Year 2025-2026
For questions, please contact Erik Jensen, Deputy Director, City Manager's Office of Administration, Policy, and Intergovernmental Relations at [email protected].
ATTACHMENTS:
Attachment A – Increasing Community Safety
Attachment B – Reducing Unsheltered Homelessness
Attachment C – Cleaning Up Our Neighborhoods
Attachment D – Growing Our Economy
Attachment E – Building More Housing
Attachment F – Focus Area Community Survey Annual Report