Milpitas

The City of Milpitas has been allocated 6,713 units (1,685 very-low-income, 970 low-income, 1,131 moderate-income, and 2,927 above-moderate-income units). Based on projected ADUs and entitled projects, the City has met 2,369 of its RHNA (including 300 very-low-income, 338 low-income, 148 moderate income, and 1,584 above-moderate-income units). The City has a remaining RHNA of 4,344 units (1,385 very-low-income, 632 low-income, 983 moderate-income, and 1,343 above-moderate-income units). Using factors such as existing uses, existing zoning, and development standards, the City has identified an inventory of sites with potential for 7,028 additional units over the eight-year planning period. This inventory can accommodate 233 very-low-income, 233 low-income, 14 moderate-income, and 159 above-moderate-income units, not adequate to fully accommodate the City’s remaining RHNA obligations. To address this shortfall in capacity, the City must rezone additional sites to provide additional development capacity across all income categories. Appendix E: Future Housing Needs identifies the detailed sites inventory based on existing zoning and proposed rezoning. Table To ensure that the City complies with SB 166 (No Net Loss), the City will monitor the consumption of residential and mixed-use acreage to ensure an adequate inventory is available to meet the City's RHNA obligations. To ensure sufficient residential capacity is maintained to accommodate the RHNA, the City will develop and implement a formal ongoing (project-by-project) evaluation procedure pursuant to Government Code Section 65863. Should an approval of development result in a reduction in capacity below the residential capacity needed to accommodate the remaining need for lower and moderateincome households, the City will identify and if necessary, rezone sufficient sites to accommodate the shortfall and ensure “no net loss” in capacity to accommodate the RHNA.

Rezone 105 acres to meet RHNA shortfall (metric). Through the Community Development Roundtable or other similar meetings, continue to cultivate relationships with property owners and developers interested in redeveloping their properties, including those who’s properties are included in the sites inventory (ongoing). Starting in 2023, maintain an up-to-date inventory of the available sites for residential development and provide it to prospective residential developers and other interested parties. Update the sites inventory at least annually. By the end of 2023, amend the Zoning Code to provide by-right approval of housing proposed on sites previously identified in the 5th Cycle Housing Element to accommodate lower income RHNA units and are being reused for this 6th Cycle update, if the project includes 20 percent of the units as lower income in the 6th Cycle. By the end of 2023, implement a formal evaluation procedure pursuant to Government Code Section 65863 to monitor the development of pipeline projects, vacant, and nonvacant sites in the sites inventory and ensure that adequate sites are available to meet the remaining RHNA by income category. By the end of 2024, rezone properties as outlined in Appendix E to provide adequate sites to accommodate the RHNA shortfall including appropriate development standards that facilitate achieving maximum densities. The rezoned sites will meet the requirements of Government Code 65583.2, including but not limited to a minimum density of 20 units per acre (as the low end of the density range for each zoning district), minimum site size to permit at least 16 units on site, and zoned to allow ownership and rental housing by right in which at least 20 percent of the units are affordable to lower income households. Through pipeline projects monitoring, ensure projects continue to move forward, and if not, add additional rezone sites. By the end of 2025, re-engage property owners and developers who exhibited interest in redeveloping their properties. Identify steps and/or actions to transform interest into affordable housing production. Continue process to dispose of city-owned sites included in the sites inventory (R-11), comply with the Surplus Lands Act and target 207 units, including 41 units affordable to lower income households in the planning period consistent with assumptions in the inventory. • Parcel #1 located at 1432-1446 S. Main Street. On December 7, 2021, the City Council directed staff to dispose of the property, which is zoned for high-density residential. The sale of Parcel #1 is expected to take place in Q2 2023; therefore, disposition of Parcel #1 will be completed early in the implementation process of the Housing Element. Entitlement are anticipated in 2024 and building permits are targeted to be completed 2025. • The City of Milpitas owns Parcels #2 and #3 located at 1454- 1466 S. Main Street and 1476-1488 S. Main Street, respectively. Parcels #2 and #3 are also zoned high-density residential. The City Council directed staff to bring back Parcels #2 and #3 upon adoption of the Milpitas Metro Specific Plan, which is expected in Q1 2023. If the Council decides to utilize the sites toward housing, disposition or lease will be targeted for 2025 along with entitlements in 2026 and permits in 2027. By the end of 2027, if City-owned sites are not permitted as assumed in the sites inventory, the City will identify sites and make zoning available to an equivalent number of units and affordability, including appropriate densities within one year.

The City will continue to facilitate the consolidation of small lots for residential and mixed-use development. The City will develop tools to encourage lot consolidation. Depending on the tools developed, these will be incorporated into the Zoning Ordinance and Building Code update (Program 21).

By the end of 2024, develop tools to facilitate and incentivize lot consolidation, which may include: • Additional density bonus • Flexible development standards (such as setbacks, parking) • Streamlined ministerial or administrative processing unless application is in conjunction with other actions that require discretionary reviews Beginning in 2025, promote lot consolidation incentives to developers via City website.

The City will continue to enhance neighborhood conditions by enforcing its existing codes through its Code Enforcement Program. This program has been strengthened through the passage of the Neighborhood Beautification Ordinance (NBO) (Chapter 500 of Municipal Code), which establishes guidelines for the overall maintenance and preservation of neighborhoods citywide. As needed, the City will assist any households displaced by code enforcement activities to relocate to other suitable housing, affordable to the displaced households, through the Replacement/Relocation Program. The City of Milpitas’s Building Safety and Housing Department adopted the 2022 California Building Standards Code with local amendments. The City has adopted detailed Standard Operating Procedures (SOP) to guide the City’s Code Enforcement Program.

Continue to implement the Code Enforcement Program (ongoing). Continue to refer income-eligible households to the City’s Housing Rehabilitation Program for assistance with code corrections (ongoing). Continue to offer replacement/relocation assistance to income-qualified households when displaced by code enforcement activities (ongoing).

The City will continue to utilize the services of Project Sentinel (or other qualified nonprofits) to provide fair housing outreach and assistance, landlord‐tenant mediation services, mortgage default counseling, and referrals to other support services to Milpitas residents, landlords, and housing professionals. The COVID-19 pandemic has shown that emergency rental assistance is a critical tool for avoiding evictions – as well as the burden of judgments for rent debt – in times of emergency. Moreover, rental assistance is an intervention that prevents the burden of eviction from disproportionately falling on Hispanic or Latino households. In Milpitas, 54% of Hispanic or Latino households rent as opposed to just 31.3% of Asian households and 34.5% of non-Hispanic White households. Additionally, Hispanic or Latino individuals disproportionately work in front-line positions that could be vulnerable to lay-offs in the event of subsequent pandemic waves. According to data from the California Department of Housing and Community Development, 32.89% of COVID-19 rent relief applicants from Milpitas were Hispanic or Latino, more than double the share of Milpitas’ population that is Hispanic or Latino

Promote rental assistance with the objective to assist 300 Milpitas residents, landlords, and housing professionals over the next eight years with rental assistance (metric, ongoing). Continue to promote housing services with the objective to support approximately 320 persons each year through Project Sentinel’s outreach and informational workshops, phone call assistance, fair housing, and other support (metric, ongoing). Continue to facilitate and ensure compliance with the California Tenant Protection Act of 2019 (AB 1482) that regulates just cause evictions and maximum annual rent increases (ongoing). Continue to offer programs that supplement housing costs and reduce overall living expenses for lower- and moderate-income households such as the ongoing Milpitas Assistance Program (MAP) and the ARPA Childcare Subsidy Program, which was launched in 2022 and offers assistance of up to $1,000 per year for families (ongoing). Continue to coordinate with the San Andreas Regional Center (SARC) for services, outreach, and referrals for tenants with disabilities (ongoing).

As recognized by the California Legislature in passing Assembly Bill 686, displacement is a major fair housing issue in the state. In Milpitas, significant demographic change has already occurred in the Transit Area over recent decades, and the experience of Sunnyhills Apartments illustrates the risk of the loss of badly needed deeply affordable housing. Although Milpitas does not have any geographic concentrations of low-income residents, the City will work to supplement the California Tenant Protection Act to support the thousands of low-income families in the city against the rising housing costs that pose a significant risk to those families.

Provide rent relief and mortgage protection funds to at least 250 households by 2031(metric). Maintain the City’s Rent Relief program (ongoing). Continue to implement the Milpitas Assistance Program (MAP) which provides low-income residents subsidy for Recreation and Community Services programs, water utilities bill discounts, and reduction of building permit fees from Building Safety and Housing for replacement of a water heater, furnace, or air conditioner (ongoing). By the end of 2025, complete a targeted survey to assess the need and impact of the City’s rental assistance program. Evaluate conducing the survey on a 4-year cycle to capture changes in the renter population. By the end of 2026, supplement the California Tenant Protection Act of 2019 by evaluating and enacting certain anti-displacement measures. Example measures for exploration include: • Targeting assistance to lower resource neighborhoods through Project Sentinel or similar service providers. • Increasing fair housing awareness and proactively monitor and enforce fair housing compliance, particularly for lowerincome households, disabled tenants, and people of color. • Developing and adopting relocation assistance program. • Expanding tenant protections, such as anti-eviction measures and tenant legal services Expanding the City’s existing Rent Relief and Mortgage Protection Program. • Supporting a tenant resource center, including expanding legal services and other assistance for lower-income households. • Implementing right to counsel in residential eviction proceedings and providing financial support for eviction prevention services. • Creating a rental inspection program for apartment buildings. • Other measures as appropriate.

Most of the City’s affordable units are subject to affordability restrictions that extend significantly beyond the ten‐year period that follows adoption of the Housing Element Update. The City will continue to work to preserve at-risk housing, including but not limited to Sunnyhills, which provides 149 Section 8 units that require renewal of the subsidy contract with HUD periodically. Sunnyhills’ current contract expires in 2023. However, the owner of Sunnyhills has indicated its intention to renew the contract for another five years. In addition, there is a plan to add 44 new units on site, with seven units being affordable to extremely low-income seniors. Site preparation for construction has already begun as of July 2022.

Preserve 149 units at Sunnyhills Apartments (metric). Continue to monitor annually the status of Sunnyhills (ongoing). If a Notice of Intent (NOI) is filed to opt out of low-income use, ensure property owner adheres to the noticing requirements (three-year, oneyear, and six-month). If necessary: • Establish contact with public and non‐profit organizations, such as Mid‐ Peninsula Housing Coalition, BRIDGE Housing, and other non‐profit housing providers working in the Santa Clara area to inform them of the potential conversion status of Sunnyhills Apartments and to determine interest in purchasing and/or managing units at‐risk. • Provide funding, if available, and technical assistance and support to these organizations with respect to financing to acquire or replace these units. • Ensure tenants of at‐risk units are properly noticed by property owners should a NOI to opt out of low-income use is filed. Provide education and support regarding tenant rights and conversion procedures, Section 8 vouchers available through the Santa Clara Housing Authority, and other housing opportunities in the City for lower‐income households. • Assist tenants to obtain priority status on the Section 8 Waiting List. Continue funding and administering a City Rent and Mortgage Relief Program for households and individuals at risk of eviction, homelessness, or foreclosure, and seek available funding to supplement or expand the program (ongoing). By the end of 2026, evaluate and identify more permanent funding options for the Sunnyhills apartments to ensure long-term housing stability and affordability.

The City will continue to maintain and enforce its Mobile Park Home Rent Control Ordinance which regulates rental rates and the rights and responsibilities of tenants and property owners for the three mobile home parks in Milpitas. The City will continue to utilize the services of Project Sentinel (or a similar organization) to administer the rent mediation process.

Continue the implementation of Rent Control Ordinance (Title 3, Chapter 30 of the Municipal Code) to preserve the affordability of the three mobile home park spaces (ongoing). Maintain the rent mediation hearing process and non-rent dispute processes.

The City will implement a Housing Opportunity Zones (HOZ) program to utilize incentive-based zoning in multi-family and mixed-use zoning districts. The program, which is currently under development, will provide incentives (permit streamlining, CEQA streamlining, relaxed development standards, and financial incentives) for affordable developers and mixed-income housing.

Foster the development of at least 200 affordable housing units in housing opportunity zones that will be affirmatively marketed to residents of lower resource neighborhoods in Milpitas and the broader region, including East San José (metric). Continue conducting consultation with the development community regarding the provisions of HOZ (ongoing). By end of 2023, adopt the HOZ to incentivize affordable housing beyond the requirements of the City’s Affordable Housing Ordinance through: • Supplemental density bonus beyond State Density Bonus Law, such as additional incentives for producing housing units for extremely low, very low, and low-income households and units for persons with disabilities. • Relaxed development standards (such as maximum height, minimum parking ratio, minimum open space requirement, etc.) • Financial incentives (such as reduced impact fees, etc.) • Streamlined permitting process (ministerial approval) • By-right approval beyond properties subject to AB 1397 if projects meet certain objective criteria • Encouragement of special needs housing, including senior living, housing for persons with disabilities, and workforce housing • Promotion of affordable housing in higher resource neighborhoods to further fair housing and equity goals.

The City will continue to facilitate the production of affordable housing through the Affordable Housing Ordinance (AHO), which came into effect in July 2018 and was amended in February 2022. The AHO requires all new residential projects with ten or more units to develop 15% of the total number of units as affordable units.

Facilitate the development of 2,600 affordable units through the AHO and other affordable housing activities (e.g., Program 16: Affordable Housing Development) over eight years (metric). Facilitate the development of at least 1,160 affordable housing units through the 15% inclusionary housing requirement of the AHO over eight years (metric). Continue to update the in-lieu fee every year to reflect the cost of development (ongoing). Continue to offer a preference program for affordable housing units to McKinney-Vento households with children, current and former Milpitas residents, and workers employed in Milpitas (ongoing). By the end of 2025, amend the AHO to define the percentage of required very low-, low-, and moderate-income units, and to incentivize the production of affordable units beyond the minimum requirement, including extra credit or points for extremely low-income units. By the end of 2027, review the AHO requirements to ensure the AHO remains effective and reflect market conditions.

The City will continue to implement its Below Market Rate (BMR) Program, which is designed to assist low- and moderate-income households in becoming homeowners. To be eligible for a BMR home, the applicant must be a first-time homebuyer (who has not owned a home during the three-year period prior to date of the application) and can provide at least 10% required down payment. While every applicant must meet the City’s basic eligibility requirements, the City of Milpitas gives some households a lottery preference that increase the chance that they will be offered an affordable unit. These preferences include Milpitas residents, individuals who work in Milpitas, former Milpitas residents who have been displaced, and families with children enrolled in the McKinney Vento Program at the Milpitas Unified School District (MUSD). While program participants may not apply for BMR financial assistance, the training program for first-time homeowners is a beneficial service provided by the program.

Facilitate 20 low- and moderate-income households to become first-time homeowners consisting of either financial assistance or completion of training program (metric). By the end of 2023, review eligibility requirements to ensure that they do not disproportionately exclude members of protected classes, particularly with respect to criminal and credit history. By the end of 2023, incorporate requirements for inclusive tenant screening into any agreements with entities administering BMR rental units. By the end of 2024, conduct affirmative marketing of the program to Black and Latino/Latina residents, both groups that have disproportionately low homeownership rates in the region. By the end of 2024, engage in affirmative marketing to Black and Latino/Latina households that are eligible for the City’s live-work preference to ensure equitable participation in the BMR program.