CITY OF SAN MATEO
CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 8 Section Name: {{section.name}} Account Number: 34-3133 File ID: {{item.tracking_number}} TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: Community Development Department
MEETING DATE: May 19, 2025
SUBJECT:
Metropolitan Transportation Commission Transit-Oriented Communities Policy Grant – Adoption RECOMMENDATION:
Adopt a Resolution committing to completing the City of San Mateo’s tasks toward achieving compliance with the Metropolitan Transportation Commission’s (MTC) Transit-Oriented Communities (TOC) Policy, as a condition for MTC to allocate regional discretionary funding to the Housing Policy Development Project (Grand Nexus Study).
BACKGROUND:
In 2022, the Metropolitan Transportation Commission (MTC) adopted the Transit-Oriented Communities (TOC) Policy to support the region’s transit investments by creating communities around transit stations and along transit corridors that not only enable transit ridership, but also are places where all Bay Area residents can live, work and access services. TOC Policy applies to locations within half mile of existing and planned stops and stations served by Bay Area transit systems.
San Mateo’s three TOC areas include the half mile radius around the Hayward Park, Hillsdale, and San Mateo Caltrain transit stations.
TOC Policy requirements for local jurisdictions include minimum residential and commercial office densities for new developments, adoption of affordable housing production, preservation, and protection policies, as well as requirements for stabilizing businesses to prevent displacement. Additional requirements for parking management and transit station access are also applicable.
Compliance with TOC policy requirements is necessary for cities to be eligible for One Bay Area Grant (OBAG) funding. MTC acts as the pass-through agency for OBAG, a federal transportation funding source. OBAG 3, which spans the years 2023- 2026, totaled $750 million, and included a $200,000 grant to the City for parking management planning (Citywide parking requirements update), $610,000 for planning and rezoning update work, and $3,375,000 for Complete Street Class IV improvements at the 19th Ave/Fashion Island Blvd intersection. The process for cities to confirm compliance with TOC Policy will continue on a rolling basis until an anticipated deadline in early 2026, which corresponds with the OBAG 4 funding timeframe.
In October 2024, MTC announced its grant program, which allocated $60 million in planning and capital grants to provide support to cities to achieve compliance with TOC Policy. Twenty million was set aside for grants to cities for planning and implementation of specific TOC elements such as the adoption of TOC-compliant zoning amendments, housing policies, parking management, and planning for station access and circulation. MTC made approximately two million available for one-time grants to jurisdictions specifically to support the development and adoption of TOC-compliant housing policies.
City of San Mateo staff submitted two grant applications to MTC in November 2024. In one grant application, the City
CITY OF SAN MATEO
requested, and MTC granted, $610,000 to help fund the City’s Comprehensive Zoning Code Update. City Council accepted those grant funds under via Resolution on March 17, 2025.
The second grant application was for a multi-jurisdictional housing fee nexus and inclusionary housing policy study, referred to as the Grand Nexus and Feasibility Study, to be led by 21 Elements (San Mateo County’s regional planning collaborative) on behalf of the Cities of Belmont, Brisbane, Daly City, Menlo Park, Redwood City, San Bruno, and San Mateo. The City of San Mateo, among these other jurisdictions, committed to completing an update to the City’s housing nexus fees and inclusionary housing policy in the 2023-2031 Housing Element (Policy H 1.17). A joint study will cover topics relevant to all participating jurisdictions and consider each jurisdiction’s unique needs and housing requirements.
The City of Belmont submitted the application on behalf of all participating jurisdictions and committed to administering the grant funds as the fiscal agent. In March 2025, MTC awarded a grant for $500,000. The grant funding will offset a substantial portion of the consultant costs of implementing this requirement. The County of San Mateo, in coordination with 21 Elements, will act as the contracting entity on behalf of the participating jurisdictions. The County will manage the contract payments, and the City of Belmont will coordinate with them as the fiscal agent for the grant to manage reimbursements for the portion of the contract that is covered by the grant award.
The specific share of the grant funds that will be directly attributable to the City of San Mateo will be determined once the Request for Proposals (RFP) process is complete and the exact amount of the consultant contract is determined.
To accept this multi-jurisdictional grant award of $500,000, each city is required to adopt a Resolution committing to completing tasks that arise from the Grand Nexus Study and to comply with MTC TOC policy. The Belmont City Council approved a Resolution authorizing Belmont to accept the grant funds on April 22, 2025, and the next step is for each co- applicant jurisdiction to follow suit and adopt their own Resolutions. ABAG/MTC has set a deadline of June 30, 2025 for the Resolution adoptions. The Proposed Resolution is included as attachment 1.
BUDGET IMPACT:
There is no impact to the General Fund from participating in the Grand Nexus Study. The City of Belmont will receive the funds on behalf of the City of San Mateo and use them to cover the costs of the Grand Nexus Study.
Depending on the final consultant contract, it is anticipated that the City 19500will contribute up to $35,000 from the Commercial Linkage Fee fund (Fund 255) to cover remaining consultant fees for the Grand Nexus Study. There are sufficient funds available in Fund 255 to support these costs.
ENVIRONMENTAL DETERMINATION:
This Resolution is not a project subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5)).
NOTICE PROVIDED
All meeting noticing requirements were met.
ATTACHMENTS
Att 1 – Proposed Resolution
STAFF CONTACT
Van Diggans, Housing Specialist II
[email protected]
(650) 522-7229