CITY OF SAN MATEO
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CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 11 Section Name: {{section.name}} Account Number: 25-3112 File ID: {{item.tracking_number}} TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: Community Development Department
MEETING DATE: March 17, 2025
SUBJECT:
2024 Annual Progress Reports: Housing Element, General Plan, and Housing Successor Agency - Approval RECOMMENDATION:
Approve the Annual Progress Reports and direct the City Manager to submit the 2024 General Plan Annual Progress Report to the California Office of Policy and Research; the 2024 Housing Element Annual Progress Report to the California Department of Housing and Community Development; and the 2024 Housing Successor Agency Annual Report to the California Department of Finance.
BACKGROUND:
Government Code Sections 65400 and 65700 require local planning agencies to submit an Annual Progress Report (APR) on the status of their General Plan and Housing Element implementation to the local legislative body. The APR is then submitted to California Department of Housing and Community Development (HCD) and Office of Planning and Research (OPR) by April 1st of each year.
California Health and Safety Code Section 34176.1(f) similarly requires jurisdictions to submit an annual Housing Successor Agency Report by the same deadline to the California Department of Finance (DoF). This report provides details of the housing funds, assets, and activities of the City of San Mateo, which is acting as the Housing Successor Agency of the former Redevelopment Agency of the City of San Mateo.
This agenda report contains the General Plan and Housing Element Annual Progress Reports (Attachments 1 and 2) and Housing Successor Report (Attachment 3) for review and approval by City Council. An overview of each of the three state- mandated reports is provided below.
Housing Element Annual Progress Report Summary
While the Housing Element is a part of the General Plan, the Housing Element APR is subject to additional and specific requirements not applicable to other elements of the General Plan. The Housing Element APR has been prepared pursuant to California Government Code Section 65400 and includes a detailed accounting of all housing projects submitted, reviewed, entitled, and constructed in the City in 2024. The APR also provides an update on the implementation on each of the Housing Element’s policies and programs to achieve the City’s housing vision.
This is the second reporting year of the City’s 2023-2031 Housing Element for the sixth housing cycle, which was adopted by the City Council May 20, 2024 and determined to be in substantial compliance with Housing Element law by HCD on July 23, 2024. It includes the following information:
Progress report on implementation of the Housing Element programs (Attachment 1 - Table D)
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Progress in meeting the City’s Regional Housing Needs Allocation (RHNA) by income level (Tables A2 and B) Information on the types of housing units that were issued building permits, as well as those that were completed (Table A2)
Information on number of planning applications submitted, as well as those that were approved (Table A) Information on the City’s local preference policy (Table K) Accomplishments from the City’s Local Early Action Planning (LEAP) grant Other information required by HCD, including:
oSites identified or rezoned to accommodate shortfall housing need and No Net-Loss Law (Table C) oCommercial Density Bonus projects (Table E)
oUnits rehabilitated, preserved, or acquired for alternative adequate sites (Table F) oAbove moderate income units converted to moderate income units (Table F2) oLocally Owned Lands that have been sold, leased or otherwise disposed of (Table G), oStudent Housing Development for lower-income students (Table J) Progress Towards RHNA Targets
The City continued to make meaningful progress towards its RHNA in 2024, including the following achievements:
303 Baldwin Ave., a mixed-use project with 64 rental units, including 6 very low-income BMR units, received its certificate of occupancy;
Kiku Crossing, a 225-unit affordable housing development on City-owned land, received its final certificate of occupancy on August 16, 2024 and reached full occupancy at the end of 2024; Peninsula Heights, a 290-unit multifamily for-sale development on a former office campus site that includes 29 low-income BMR units, received its building permits;
477 9 th Ave., a mixed-use project on a former office site that includes 120 rental units, including 12 very low- income units, was entitled (building permit issued March 2025); 91 Accessory Dwelling Unit (ADU) applications received and 66 ADU permits issued; and Two SB 9 projects processed.
Table 1 below summarizes some of the key data contained in Table A and A2 regarding housing units and their affordability levels, including planning applications submitted and approved in 2024, as well as building permits issued and completed/constructed (certificate of occupancy). Per HCD definition, applications submitted are applications that have been determined complete by the jurisdiction. Please note that building permit is the milestone HCD uses to count units towards a jurisdiction’s RHNA progress.
Table 1 - 2024 Housing
Units Summary Table Very Low Low Moderate
Above
Moderate Total Report Table
Planning Applications
Units Submitted 5 5 5 7 22 Table A
Units Disapproved 0 0 0 0 0 Table A
Total Units Approved 5 5 5 7 22 Table A
Building Permits
Permit Issued 20 20 20 107 167 Table A2
Certificate of Occupancy 137 119 10 126 392 Table A2
Table B in the attached APR shows the progress of housing unit production by affordability level as defined by issuance of building permits in 2024 and throughout the 2023-31 Housing Element cycle. Thus far, two years into the housing cycle (2023 and 2024), 308 units, or 4.4 percent of the City’s allocation for new housing units, have received a building permit, as shown in Table 2 below. For comparison, the City reported 92 units in 2023. 2024 remained a challenging environment for new housing construction starts due to the larger nationwide challenges related to securing construction financing and high costs of labor statewide, resulting in multiple development projects with housing units that were previously approved not moving forward with construction this year and/or receiving deadline extensions. However, with the passage of
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Measure T, along with a potentially improving construction financing environment, the City’s current development pipeline holds a lot of potential for significantly increased housing production in the coming years.
Table 2 – RHNA and Housing Construction
Projection Period
06/30/2022-
01/30/2023
2023 2024 Total Units Total RHNA
Total Housing Units 49 92 167 308 7,015
Very Low Income Units 1 24 20 45 1,777
Low Income Units 13 24 20 57 1,023
Moderate Income Units 25 20 20 65 1,175
Above Moderate-Income
Units 10 24 107 141 3,040
Accessory Dwelling Units
Following adoption of the City’s ADU Ordinance on March 21, 2022, the City Council directed staff to provide annual updates on the implementation of the Ordinance. ADUs have become an increasingly popular solution to provide additional living units in residential neighborhoods. Any ADU that meets the standards outlined in the City’s adopted ADU Ordinance is approved ministerially (building permit only). However, to allow for flexibility and creative ADU designs, the City offers a discretionary permit application option through an Accessory Dwelling Unit Discretionary Review (ADUDR) Planning Application process to consider proposals for ADUs that are not in full compliance with the development standards outlined in the adopted ADU Ordinance. It should be noted that the vast majority of ADU proposals conform to these development standards and are processed ministerially, with only seven ADUDR applications out of 91 total ADU applications (7.7 percent of total).
The City began processing ADUDR applications after adoption of the ADU Ordinance in 2022, and a total of 17 ADUDR applications have been submitted since going into effect. Of the 17 total applications, six proposed the expansion of an existing structure within a legal non-conforming setback of less than four feet from a property line, seven proposed a second-story balcony, and four proposed a height exceedance. Nine of the 17 submittals have been approved, two are currently under review, and six were withdrawn. For each of the withdrawn ADUDR applications, the applicant revised, or communicated intentions to revise, the proposal to conform to ADU development standards and resubmit for a ministerial permit. An overview of all ADUDR applications received to-date are summarized in Table 3 below. Currently, per Council direction, ADUDR applications are processed at no additional cost to the applicant. This no-cost approach is considered a pilot program, and staff will bring the topic back to Council for review at a later date.
In October of 2024, the City received a letter from HCD with a review of the City’s ADU Ordinance, identifying areas that require updates or clarification for compliance with State ADU Law. Staff met with HCD staff to review and discuss the letter and provided an official response to HCD’s letter in November 2024 and will propose Zoning Code amendments accordingly to ensure that the ADU Ordinance is compliant with current state law requirements. The amendments to the ADU Ordinance are targeted for public hearings later this year.
In addition to reporting on the number of ADU applications, jurisdictions must also include data in the APR on the affordability of ADUs. Beginning in 2025, San Mateo will be requiring applicants to complete an ADU rental survey prior to permit issuance for ADUs. The survey was created in a regional partnership with the Association of Bay Area Governments (ABAG) as a tool for participating jurisdictions to track ADU affordability and has been reviewed by HCD. The data collected from this survey will be aggregated and summarized by ABAG such that homeowner responses are anonymous and will be provided to each jurisdiction to be used in future APRs to distribute levels of affordability for ADUs.
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Table 3 – Accessory Dwelling Unit Design Review (ADUDR) Planning Applications Application
#
Year Reason for ADUDR Determination
PA-2022-048 2022 Expansion of existing structure within required setbacks Approved PA-2022-049 2022 Height exceedance Approved
PA-2022-082 2022 Expansion of existing structure within required setbacks Approved PA-2022-084 2022 Expansion of existing structure within required setbacks Approved PA-2023-023 2023 Second-story balcony Withdrawn
PA-2023-048 2023 Second-story balcony Withdrawn
PA-2023-059 2023 Second-story balcony Approved
PA-2023-073 2023 Height exceedance and daylight plane encroachment Withdrawn PA-2023-086 2023 Expansion of existing structure within required setbacks Approved PA-2023-091 2023 Expansion of existing structure within required setbacks Approved PA-2024-001 2024 Second-story balcony Withdrawn
PA-2024-006 2024 Height exceedance and daylight plane encroachment Approved PA-2024-013 2024 Second-story balcony Withdrawn
PA-2024-031 2024 Height exceedance Withdrawn
PA-2024-033 2024 Second-story balcony Under Review/Incomplete PA-2024-035 2024 Encroachment into the daylight plane and for a second- floor balcony
Under Review/Incomplete
PA-2024-057 2024 Conversion of existing structure with Less than 4-foot setback and an increase of the plate height
Approved
SB 9 Projects
Following adoption of the City’s SB 9 Ordinance on October 3, 2022, the City Council directed staff to provide annual updates on the implementation of the Ordinance. SB 9 generally allows the building of two primary dwellings on a single- family lot and/or the subdivision of a single-family lot into two lots. Effectively, it allows for the development of up to four residential units, including ADUs and JADUs, on an existing single-family lot. Any two-unit development that meets the standards outlined in the City’s adopted SB 9 Ordinance is approved ministerially. However, to allow for flexibility and creative designs, the City offers a discretionary permit application option through a Single-Family Dwelling Design Review (SFDDR) Planning Application process to consider proposals for dwellings that are not in full compliance with the SB 9 development standards.
The City began processing SB 9 applications after adoption of the SB 9 Ordinance in 2022. Since that time, a total of five SB 9 applications have been submitted. Of the five applications, three were approved ministerially and two required discretionary review. These discretionary reviews were required to evaluate SB 9 units over 800 square feet in size, which is the maximum unit size that can be proposed under a ministerial SB 9 application. Of these two discretionary reviews, one was approved by the Zoning Administrator and subsequently appealed to the Planning Commission, which upheld the Zoning Administrator approval. The other discretionary SB 9 application is currently incomplete, requiring additional review. An overview of SB9 Discretionary Planning Applications received to-date is provided below in Table 4. Of the three ministerially-reviewed applications, two were approved and one was complete, pending Zoning Administrator approval.
Table 4 – SB9 Discretionary Planning Applications
Application
#
Year Reason for Design Review Determination
PA-2023-082 2023 SB9 Unit over 800 sq.ft. Approved by ZA, Appealed to PC (appeal denied)
PA-2024-039 2024 SB9 Units over 800 sq.ft. Under Review/Incomplete
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Goals, Policies, and Programs
The City has also made progress on implementation of the goals, policies, and programs outlined in the Housing Element.
The following is a list of the significant policies and programs that were implemented or made progress in 2024:
Measure T (Policy H.1.20)
General Plan 2040 was adopted in March; significant outreach and community engagement on Measure T were completed in May-July; City Council voted to place Measure T on the ballot in July; and voters approved Measure T in November. With the passage of Measure T, approximately 10,000 units of additional capacity was added to Housing Element’s Sites Inventory. Since Measure T went into effect on December 19, 2024, the City has received seven new development applications for housing and mixed-use projects that include a total of 2,926 new units. Streamlined Housing Application Review Process (Policy H1.6) On July 15, 2024, the City Council adopted Resolutions to eliminate the City’s pre-application requirements for housing projects and third-party design review requirements for housing projects that meet objective design standards. The pre-application process is now voluntary and third-party design review only applies to projects that do not meet the objective design standards and elect a discretionary review process. Third-party design review is at the discretion of the Zoning Administrator.
Minimum Residential Densities in Mixed-Use Developments with a Residential Component (Policy H1.9) The City Council held a study session on August 19, 2024 on requiring a minimum residential density in mixed-use projects that utilize State Density Bonus Law. Staff presented a memo from Economic Planning Systems, Inc. (EPS) on potential minimum residential density requirements in mixed-use projects with a residential component. Staff was directed to conduct developer outreach and to return with proposed minimum thresholds for different areas of the City (based on proximity to transit) and potential incentives for commercial developers to include residential units.
Family-Sized Residential Units (Policy H.1.5)
At the August 19, 2024 study session, staff presented a separate memo from EPS on setting minimum requirements for family-sized housing (3+ bedrooms), including the policy option of requiring one out of every five inclusionary housing units to contain three or more bedrooms. The City Council considered requiring a percentage of all units in a residential project to be family-sized. Staff was directed to return with specific policy language. Tenant Protections/Anti-Displacement (Policies H3.4, H3.6 and H5.4.1) In fall of 2024, staff began conducting outreach and researching tenant protections and anti-displacement measures. This includes tenant relocation protections for tenants with tenure less than one year, tenant protection policies for substantial remodel evictions, and strengthened enforcement penalties for substandard units (Policy H3.4), in addition to research on a rental registry to track rental rates and evictions citywide (Policy H.36). A community workshop on tenant protections/anti-displacement, hosted by the City's Community Relations Commission, was held on November 20, 2024, in addition to a series of focus group meetings with organizations in San Mateo. These meetings continued into 2025. Staff will present these findings to the City Council in a study session in spring 2025.
Zoning Code Amendments (several Policies)
Staff worked on drafting amendments to the Zoning Code for all policy programs that had prescribed actions in the implementation plan targeted for adoption in 2024 and 2025.These proposed code amendments are being aggregated into one Ordinance for adoption. On February 11, 2025, the proposed draft Ordinance was reviewed by the Planning Commission and recommended for City Council adoption. The City Council is considering adoption of this Ordinance as another item on this meeting agenda. Staff has noted progress in the APR, Table D accordingly.
The timelines for implementation identified in the Housing Element were developed under the assumption that the Housing Element would be certified by May 2023. Staff would then have been able to focus on implementation in the
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second half of 2023 and 2024. However, all of 2023 and the first half of 2024 were spent completing San Mateo’s 2023- 2031 Housing Element and achieving certification from HCD. Thus, because of the extended period of time to achieve certification, staff’s ability to complete all of the policies and programs within the 2024 timeline stated in the Housing Element has been significantly limited, resulting in some of the implementation efforts moving into 2025. Staff is working diligently to get all of the remaining 2024 initiatives completed, with Zoning Code amendments implementing Policy H1.9 anticipated in the first half of this year, and staff is concurrently making progress on the 2025 policies and programs.
General Plan Annual Progress Report Summary
The General Plan is a State-mandated document that sets the framework for the City’s physical, social, and economic development into the future. In 2018, California Government Code Section 65700(b) was amended to make the General Plan Annual Progress Report (APR) requirement applicable to charter cities. The City submitted its first General Plan APR in 2020, and this is the first APR for the Strive San Mateo General Plan 2040, which was adopted on March 18, 2024.
The City’s General Plan APR (Attachment 2) highlights the accomplishments in 2024 in implementing land use related goals, policies, and actions. Through the accomplishments highlighted in the APR, the City continues to make progress to achieve a healthy economic, social, and physical environment to serve the San Mateo community. The APR includes the following key information:
Planning activities initiated or completed by the City in 2024; Highlights of major planning applications approved in 2024; Building permit and construction status of major development projects; and Implementation summary of General Plan goals, policies and actions pertaining to land use.
Consistent with General Plan Action LU15.3, the City is providing population information from the California Department of Finance (DoF). These population estimates are produced annually by DoF to assist local areas in calculating their annual appropriations limit. Changes to the housing stock are used in the preparation of the annual city population estimates.
Additionally, population levels are determined by estimated housing unit occupancy and the average number of persons per household. These estimates are based on data through January 1, 2024. While California experienced positive population growth in 2023, the City's population has declined by 0.8 percent, from 104,180 on January 1, 2023, to 103,352 on January 1, 20241.
Pursuant to General Plan Policies H 1.20, LU 1.2 and LU 1.3 – The City Council voted to place Measure T on the November 2024 ballot to amend certain voter-enacted policies limiting building heights, residential densities, and nonresidential building intensities, as specified in Measure Y, and to fully allow the heights, densities and intensities permitted in the Land Use Element to be implemented. On November 8, 2024, voters approved Measure T, which permitted General Plan Table LU 1 - Land Use Designations and Figure LU 1 - Land Use Map to be fully implemented. In alignment with Goal LU-2 Balance well-designed development with thoughtful preservation, the Land Use Map focuses growth in and around Downtown San Mateo and near transit, namely Caltrain stations and the El Camino Real transit corridor, while maintaining existing neighborhood heights and densities. Additionally, Measure T allows the City to meet the community’s anticipated housing needs through 2040 as well as housing allocations the City will be required to plan for by HCD for both the current and future housing cycles.
In accordance with General Plan Policy CD 7.7, on November 20, 2023, the City Council adopted objective design standards for residential and mixed-use projects that went into effect in January 2024. The Objective Design Standards (ODS) allow for a more streamlined Design Review process, and the associated code amendments also allow for the staff level (Zoning Administrator) approval of qualifying housing projects of up to 25 units, subject to ODS.
Pursuant to Action LU1.10, the City internally tracks nonresidential development and housing units by affordability levels for all major planning applications. This data will be used in the coming years to determine if city plans need to be adjusted 1 State of California, Department of Finance, E-1 Population Estimates for Cities, Counties and the State with Annual Percent Change — January 1, 2023 and 2024. Sacramento, California, May 2024.
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or if the city-wide job-housing balance needs to be re-evaluated. The staff is currently working on developing a dashboard to provide public access to this data and anticipates reporting on this action as part of next year’s General Plan APR.
Housing Successor Report Summary
The purpose of the Housing Successor Report (Attachment 3) is to provide the governing body of the Housing Successor an annual report on the housing assets and activities of the City of San Mateo acting as the Housing Successor of the former Redevelopment Agency of the City of San Mateo as required by State law for the fiscal year July 1, 2023, to June 30, 2024.
During the FY 23/24 reporting period, the City received $ 1,348,055 in new revenues from loan repayments, which contributed to a fund balance of $5,135,204 as of June 30, 2024.
BUDGET IMPACT:
The staff time to complete this work is fully funded by Community Development’s annual operating budget, utilizing the Advanced Planning Fund, and does not impact to the City’s General Fund.
ENVIRONMENTAL DETERMINATION:
This annual report is not a project subject to CEQA, because it can be seen with certainty that it will not cause a physical change in the environment. (Public Resources Code Section 21065) NOTICE PROVIDED:
All meeting noticing requirements were met.
ATTACHMENTS
Att 1 – 2024 Housing Element Annual Progress Report
Att 2 – 2024 General Plan Annual Progress Report
Att 3 – 2024 Housing Successor Agency Annual Progress Report
STAFF CONTACT
Rachel Horst, Housing Manager
[email protected]
(650) 522-7223
Steve Golden, Principal Planner
[email protected]
(650) 522-7215
Somer Smith, Senior Planner
[email protected]
(650) 522-7215