CITY OF SAN MATEO
6 2
2 6
CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 23 Section Name: NEW BUSINESS Account Number: 25-3112 File ID: 26-10907 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: Community Development Department
MEETING DATE: March 16, 2026
SUBJECT:
2025 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 2025 General Plan Annual Progress Report to the Governor's Office of Land Use and Climate Innovation; the 2025 Housing Element Annual Progress Report to the California Department of Housing and Community Development; and the 2025 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 Governor’s Office of Land Use and Climate Innovation (LUCI; formerly the Office of Policy and Research (OPR)) by April 1st of each year.
California Health and Safety Code Section 34176.1(f) similarly provides for 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 Annual 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 calendar year 2025. The APR also provides an update on the implementation of each of the Housing Element’s policies and programs to achieve the City’s housing vision and remain in compliance with State law.
The City’s 2023-2031 Housing Element for the sixth housing cycle was originally adopted by the City Council on May 20, 2024 and determined to be in substantial compliance with Housing Element law by HCD on July 23, 2024. On February 23, 2026, the City Council adopted Housing Element Amendments that updated the sites inventory to incorporate new pipeline projects and remove projects that were no longer active, made changes related to the Measure T voter approval and the settlement of a lawsuit, revised the realistic capacity of opportunity sites based on new information, and made
CITY OF SAN MATEO
6 2
2 6
minor changes to some of the implementation plan action items. HCD found these amendments to be in substantial conformance with State law on December 18, 2025. The City is now awaiting certification from HCD, following the Council adoption in February.
This APR (Attachment 1) is for the third year of the City’s 2023-2031 Housing Element, and it includes the following information that the City has data to report on:
Information on number of planning applications submitted, as well as those that were approved (Table A) Information on the annual building activity of new construction including units entitled, permitted, and completed with the types of housing units and affordability level (Table A2) Progress in meeting the City’s Regional Housing Needs Allocation (RHNA) by income level (Table B) Progress report on implementation of the Housing Element programs (Attachment 1 - Table D) Information on locally-owned surplus sites (Table H)
Information on the City’s local preference policy (Table K) Historical resources (Table L)
Progress Towards RHNA Targets
The City continued to make meaningful progress towards its RHNA in 2025, including the following achievements:
477 9 th Ave., a mixed-use project on a former office site that includes 120 rental housing units, with 12 very low- income BMR units, received its building permit early in 2025 and is currently under construction. Peninsula Heights, a 290-unit multi-family for-sale housing development on a former office campus site that includes 29 low-income BMR units, to be built in phases, continued to make progress in 2025 by receiving building permits for seven single-family homes (market rate).
Bay Meadows Mixed-Use Block MU3, which includes a multi-family building with 67 rental units, with seven low- income BMR units, received its building permit in 2025, but construction has not yet started. 124 Accessory Dwelling Unit (ADU) applications were submitted and 94 ADU permits issued.
Table 1 below summarizes some of the key data contained in Tables A and A2 regarding housing units and their affordability levels, included in planning applications submitted and approved in 2025, as well as building permits issued and completed/constructed (final inspection or certificate of occupancy). Per HCD definition, planning applications submitted are applications that have been determined to be ‘complete’ by the jurisdiction1. Please note that building permit issuance is the milestone HCD uses to count units towards a jurisdiction’s RHNA progress.
Table 1 - 2025 Housing
Units Summary Table Very Low Low Moderate
Above
Moderate Total Report Table
Planning Applications
Units Submitted 16 2 56 357 431 Table A
Total Units Approved 7 2 4 11 22 Table A2
Building Permits
Permit Issued 21 34 29 207 291 Table A2
Certificate of Occupancy 16 14 26 59 115 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 2025 and throughout the 2023-31 Housing Element cycle. Thus far, three years into the housing cycle (2023 thru 2025), 602 units, or 8.6 percent of the City’s allocation for new housing units have received a building permit, as shown in Table 2 below. 2025 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 and construction materials 1 A “complete” planning application means that the applicant has submitted all of the materials listed on the planning application list of required submittal materials. A “complete” application may still be under review by City staff, pending processing requirements under State housing law, or awaiting approval.
CITY OF SAN MATEO
6 2
2 6
statewide, resulting in multiple development projects with housing units that were previously approved not beginning construction this year and/or receiving extensions to their entitlements. However, the City’s current development pipeline continues to grow significantly, particularly following the passage of Measure T and adoption of various state housing laws that streamline the residential development review process and provide developers more assurances for approval. In addition, there are now additional allowances under State Density Bonus Law to increase housing unit production and new exemptions and streamlining provisions to the California Environmental Quality Act (CEQA) through AB 130 and SB 131. As of the end of February 2026, the City’s pipeline projects included 19 active Planning Applications with preliminary or formal applications with over 6,200 total housing units.
Table 2 – RHNA and Housing Construction
Projection
Period
06/30/2022
-
01/30/2023
2023 2024 2025 Total Units Remaining
Total RHNA
% of Total
RHNA
Completed
Total
Housing
Units
49 92 170 291 602 6,415 8.6%
Very Low-
Income
Units
1 24 20 21 66 1,711 3.7%
Low Income
Units 13 24 20 34 91 932 8.9%
Moderate
Income
Units
25 20 20 29 94 1,081 8.0%
Above
Moderate-
Income
Units
10 24 107 207 351 2,689 11.5%
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. 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 in the ADU Ordinance. It should be noted that the vast majority of ADU proposals conform to these development standards and are processed ministerially (over 300 permits issued), with only 11 being approved utilizing the ADUDR.
The City began processing ADUDR applications after adoption of the ADU Ordinance in 2022, and a total of 19 ADUDR applications have been submitted since then. Of the 19 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. Eleven of the 19 submittals have been approved, one is currently under review, and seven 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. 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 later, likely as part of the fee study that will be initiated later this year.
CITY OF SAN MATEO
6 2
2 6
The City committed to amending the ADU Ordinance to align it with current State law and to resolve any inconsistencies identified by HCD as part of the implementation plan (Policy H 1.4). HCD has statutory authority to review local agencies’ ADU Ordinances, and as of January 1, 2024, also has authority to enforce all State ADU laws. In October of 2024, the City received a letter from HCD with a review of the City’s ADU Ordinance, identifying areas that required updates or clarification for full compliance with State ADU Law. Staff met with HCD and provided an official response to HCD’s letter in November 2024, with a target to update the ADU Ordinance by the end of 2025. On August 26, 2025, a Planning Commission study session was held to introduce ADU Ordinance updates and receive community and Commission feedback. Following the study session, staff conducted outreach and hosted a virtual workshop on local ADU needs and requirements on September 25, 2025. On December 9, 2025, the Planning Commission held a public hearing to review the draft ADU Ordinance amendments and recommended City Council adoption. On January 26, 2025, the City Council introduced the ADU Ordinance and it was adopted on February 2, 2026. Pursuant to State law, staff submitted the Ordinance to HCD for official review following adoption. As of the date of this report, there have not been any comments from HCD.
In addition to reporting on the number of ADU applications, jurisdictions must also include data in the APR on the affordability of ADUs. In previous years, HCD allowed cities to distribute ADUs into income categories using assumptions based on a statewide survey but had indicated disallowing further use of the data because it was outdated. Beginning in 2025, San Mateo required 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. The data collected from this survey was aggregated by ABAG such that homeowner responses are anonymous. ABAG submitted the results of the rental survey to HCD for review, and HCD determined the previous affordability assumptions for ABAG jurisdictions (30 percent above moderate, 30 percent moderate, 30 percent low, and 10 percent very low) could continue to be used since the results of the recent rental survey were similar to previous surveys.
The City has continued to make meaningful progress in ADU production, with 94 ADU permits issued in 2025. This is well above the annual estimate of 55 building permits for ADUs per the 2023-2031 Housing Element. According to HCD’s statewide APR Dashboard, the City leads the county in terms of ADU permitting. Table 3 highlights the number of ADUs permitted between 2023 and 2025. Since 2023, the City has issued permits for 243 ADUs, which is 55% of the total ADUs assigned by RHNA in the eight-year period for the Sixth Housing Cycle.
Table 3 – ADU Production Summary
2023 2024 2025 Total Units
Total
Remaining
RHNA
% of Total
RHNA
Completed
Total ADUs Permitted 83 66 94 243 197 55%
Very Low-Income Units 25 19 28 72 60 54%
Low Income Units 24 20 29 73 59 55%
Moderate Income Units 25 20 28 73 59 55%
Above Moderate-
Income Units 9 7 9 25 19 57%
% of Annual Estimates 150% 120% 170% 147%
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 up to two primary dwellings on a single-family lot and ADUs and JADU allowed under state law and/or the subdivision of a single-family lot into two lots.
Any 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.
CITY OF SAN MATEO
6 2
2 6
The City began processing SB 9 applications after adoption of the Ordinance in 2022. Since that time, a total of seven SB 9 applications have been submitted. Of the seven applications, three were approved ministerially and four 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 four discretionary reviews, one was approved by the Zoning Administrator and subsequently appealed to the Planning Commission, which upheld the Zoning Administrator approval. The other three discretionary SB 9 applications are currently incomplete, requiring additional review before final action can be taken. An overview of SB9 Discretionary Planning Applications received to-date is provided below in Table 4. All ministerially reviewed applications were approved by the Zoning Administrator.
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 PA-2025-061 2025 SB 9 Units over 800 sq. ft. Under Review/Incomplete PA-2025-084 2025 SB 9 Units over 800 sq. ft. Under Review/Incomplete 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 began or progressed in 2025:
Tenant Protections/Anti-Displacement (Policies H3.4, H3.6 and H5.4.1) Following community engagement and research on tenant protections and anti-displacement in San Mateo conducted throughout 2024, the City Council held a study session on April 21, 2025. oTo implement Policy H3.4, City Council directed staff to develop a policy requiring property owners to provide relocation assistance to tenants with a rental tenure of 11 months or longer in no-fault evictions and, for substantial rehabilitation evictions, provide notification when the remodeled unit becomes available. City Council also directed staff to amend the City’s Tenant Relocation Ordinance (San Mateo Municipal Code 7.50) to strengthen the City’s ability to support tenants displaced from unsafe or substandard units. The ordinances implementing Policy H3.4 were adopted in December 2025. oWhile not included as a Housing Element policy, City Council directed staff to develop an emergency rental assistance program in response to the finding that the majority of eviction cases in San Mateo are related to nonpayment of rent. The Emergency Rental Assistance Program, which is administered by Samaritan House, was created in July 2025 with an initial fund of $168,000. As part of the recently adopted Housing Element amendments, a policy to recognize this program was added to the Housing Element. oTo implement policy H3.6, City directed staff to build on existing City data collection through its Business License Tax to monitor rental rates and evictions citywide, rather than through adoption of a formal rental registry. Staff continues to work on rental data collection through its business tax platform. Zoning Code Amendment Ordinance – Phase I (several Policies) There were several amendments to the Zoning Code for policy programs that had prescribed actions in the implementation plan targeted for adoption in 2024 and 2025. For efficiency purposes, these proposed code amendments were aggregated into one ordinance for adoption (Phase I), with a second bundled amendments adopted later in 2025 (Phase II). On April 7, 2025, the Council adopted an ordinance that included the following:
oAllowed residential uses as permitted uses in commercial districts and office districts. (Policy H1.7) oAdded a definition for single room occupancy (SRO) and amend the Zoning Code to allow SROs in the R4
CITY OF SAN MATEO
6 2
2 6
District (will also apply to R5, R6 and Downtown Districts with an R overlay). (Policy H1.7) oEliminated the need for special use permits (SUPs) for multiple-family housing in mixed-use zoning districts. (Policy H1.7)
oRemoved Chapter 27.17 (Manufactured Homes) and simplify development standards for manufactured homes on a permanent foundation to be the same as single-family homes. (Policy H1.7) oRemoved any prohibitions of accessory dwelling units (ADUs) in zoning districts as a permitted use per State law. (Policy H1.7)
oAdded new Zoning Code terms and definitions related to housing and update existing definitions to add clarity and be consistent with State law. (Policies H1.7, H1.13, H1.14, H1.15, H1.16, and H3.7) oAmended the Zoning Code to allow group homes and residential care facilities for people with special needs in all residential zones and only subject to those objective standards that apply to other residential uses of the same type in the same zone in conformance with state law. (Policy 1.13) oAmended the Zoning Code to define and allow farmworker housing within the Agricultural District consistent with state law. (Policy H1.16)
oModified the “emergency shelter” definition and added development standards to the definition; added new terms and definitions for supportive housing and low-barrier navigation centers; allowed for emergency shelters, supportive housing, and low-barrier navigation centers in certain zoning districts per State law. (Policy 3.7)
oModified the Powers and Duties of the Zoning Administrator to review and take final action on proposed residential development projects that are consistent with the ODS by increasing the project size threshold from 25 units to 99 units. (Policy H1.6)
Additional Zoning Code amendments will be forthcoming as part of the Comprehensive Zoning Code Update, which is currently underway, or as separate action items as targeted in the implementation plan. General Plan Implementation (Policy H 1.20)
On April 7, 2025, the Council adopted an ordinance to amend the General Provisions section of the Zoning Code relating to implementation of Measure T and General Plan consistency. The provisions incorporate the uses, densities, intensities, and heights specified in Land Use Element of General Plan 2040 (Measure T) where they may conflict with the existing Zoning Code and establishes the standards in General Plan 2040 as governing until the Comprehensive Zoning Code Update has been completed.
Zoning Code Amendment Ordinance – Phase II (Policies H1.6 and H1.9) For this bundle of Zoning Code amendments, several chapters of the Zoning Code were amended to implement programs to support the goal of housing production within the Housing Element. On July 28, 2025, the City Council adopted an ordinance that amended and added several sections of the Zoning Code to reduce the development review timeline for housing projects by streamlining the development review process, aligning City requirements with SB 330, and adding certainty in the development application process. The ordinance established an appeals process when a planning application is determined to be ‘incomplete’ subject to the review and determination of the Planning Commission. The ordinance amended a code section to allow the Zoning Administrator to approve up to two extensions to a planning application approval, each for up to two years, in addition to the regular 2.5-year expiration from the approval date. This allows developers to complete the construction of the project as approved, which is also in the City’s interest to satisfy the housing production targets in the Housing Element. An additional measure to streamline the development review process was to change the requirement for City Council approval authority of proposed residential projects only when they exceed the building height limit specified in General Plan 2040 (all other projects are subject to Zoning Administrator or Planning Commission approval per Phase I amendments). Finally, the ordinance established minimum densities for all residential mixed-use development projects that are proposed in the mixed-use land use designations established in General Plan 2040, with slightly higher minimum densities for areas within ½-mile of a Caltrain station.
CITY OF SAN MATEO
6 2
2 6
Alternative Affordable Housing Compliance for Housing Development Projects (Policy H1.3) Policy H.1.3 is one of many actions in the Housing Element intended to increase affordable housing production by providing greater flexibility to developers. The City’s Below Market Rate (BMR) Guidelines require 15 percent of total units (base density) in a housing development of 11 or more units to be provided as affordable to lower- income or moderate-income households, depending on whether the development is rental or for-sale. While the previous BMR Guidelines allowed for an offsite alternative compliance option, it was limited to cases in which building the required affordable units on-site was infeasible, as demonstrated by the applicant with an economic analysis. The BMR Ordinance (San Mateo Municipal Code 27.16.050) and Guidelines were updated on June 16, 2025, to allow for offsite units or a developer-proposed alternative.
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. The City’s General Plan APR (Attachment 2) highlights the accomplishments in 2025 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 2025; Highlights of major planning applications approved in 2025; 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 LU 15.3, 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, 2025. The City's population has increased by 0.1 percent, from 104,221 on January 1, 2024, to 104,315 on January 1, 20253.
Pursuant to General Plan Policies H 1.20, LU 1.2 and LU 1.3 – In November 2024, following the adoption of General Plan 2040, Measure T was approved by the voters to fully allow the heights, densities and intensities permitted in the Land Use Element to be implemented. Measure T allows the City to meet the community’s anticipated housing needs through 2040 as well as housing allocations (RHNAs) the City will be required to plan for by HCD for both current and future housing cycles between now and 2040. The City is working on a Comprehensive Zoning Code Update to implement General Plan 2040 and Measure T.
Pursuant to Action LU 1.10, 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 or if the city-wide job-housing balance needs to be re-evaluated. Staff is currently working on developing a dashboard to provide public access to this data and anticipates reporting on this action as part of a future year 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, 2024 to June 30, 2025.
At the end of the FY 24/25 reporting period, the fund balance was $5,448,369. Per State law Section 34176.1(a)(2)(A) of the California Health and Safety Code, up to $500,000 in Low/Moderate Housing Income Asset Funds may be used to 3 State of California, Department of Finance, E-1 Population Estimates for Cities, Counties and the State with Annual Percent Change — January 1, 2024 and 2025. Sacramento, California, May 2025.
CITY OF SAN MATEO
6 2
2 6
prevent homelessness. In FY 25/26, the City began using Low/Moderate Housing Income Asset funds to support the new Emergency Rental Assistance Program ($168,000) administered by Samaritan House and the City’s Homeless Outreach Team ($190,000), operated out of the Police Department. The HOT was previously funded entirely out of the General Fund.
BUDGET IMPACT:
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 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 – 2025 Housing Element Annual Progress Report
Att 2 – 2025 General Plan Annual Progress Report
Att 3 – 2025 Housing Successor Agency Annual Progress Report
STAFF CONTACTS
Rachel Horst, Housing Manager Steve Golden, Principal Planner Somer Smith, Senior Planner [email protected] [email protected] [email protected] (650) 522-7223 (650) 522-7215 (650) 522-7215