City Council

Summary

The San José City Council will hold a closed session on January 13, 2026, at 9:30 a.m. in Conference Room W-133 to discuss three matters of existing litigation and one anticipated litigation.

Existing Litigation:

1. California Waste Solutions, Inc. v. City of San Jose: A case in the U.S. District Court, Northern District of California (Case No: 23-cv-01647-MMC), seeking damages.
2. Loessberg, Casilia v. City of San Jose: A case in the Santa Clara Superior Court (Case No: 23cv411999), seeking damages.
3. In re: Claim of Borreson: A worker's compensation claim before the Worker’s Compensation Appeals Court (Case No: ADJ18280309), seeking benefits.

Anticipated Litigation:
One matter is scheduled for discussion regarding the potential initiation of litigation.

Citizen Impact

This closed session agenda item involves legal matters and potential litigation that could have future financial implications for the city, but there is no direct impact on residents' daily lives at this time.

Confidence

high

Summary

The City Council is reviewing the First Quarter Financial Reports for Fiscal Year 2025-2026, covering Debt Management, Investment Management, Revenue Management, and Purchasing & Risk Management for the period ending September 30, 2025.

Investment Management: The total investment portfolio stands at $2.60 billion, with an earned interest yield of 4.025% and fiscal year-to-date net interest earnings of $27.1 million. The General Fund balance decreased by $415 million to $366 million due to prefunding retirement contributions and debt service payments. The portfolio remains compliant with the City's Investment Policy, and an external audit found no exceptions.

Debt Management: Total outstanding debt for the City and its agencies is $4.42 billion. New debt issuances in Q1 totaled $491.85 million, including $209.6 million in General Obligation Bonds, $50.0 million for Wastewater, $47.8 million in Lease Revenue Bonds, and $184.5 million for multifamily housing projects. The City maintains high credit ratings (e.g., AAA from Fitch for GO Bonds).

Revenue Management: The Revenue Management Division achieved a Return-on-Investment (ROI) of 5.1 to 1, exceeding its target. Total delinquent receivables are $53.5 million. Amnesty Programs for Accounts Receivable and Utility Billing, which concluded on September 30, 2025, generated $615,000 and $1.29 million in payments, respectively, while waiving $300,000 and $1.5 million in penalties and interest.

Purchasing & Risk Management: The Purchasing Division executed 512 purchase orders totaling $142.6 million and 4 contracts worth $19.8 million. Risk Management billed $219,614 in subrogation claims.

Citizen Impact

This report demonstrates the city's strong fiscal health and responsible financial management, ensuring stable funding for essential public services. Residents and businesses benefited from $1.8 million in waived penalties and interest through the amnesty programs, while efficient revenue collection and investment strategies help avoid future tax increases.

Confidence

high

Summary

The City Council is considering a resolution to authorize the City Manager to negotiate and execute an agreement with NATEC International, Inc. for city-wide safety training services for City employees. This agreement will have an initial term from contract execution through June 30, 2030, with two one-year options to extend, bringing the potential total term to six-and-a-half years. The total compensation for this agreement will not exceed $3,185,000. NATEC was selected through a Request for Proposals process, receiving the highest score of 87, and demonstrated expertise in delivering a wide range of regulatory-required occupational safety training, including electrical safety, hazardous materials, and fall protection. This service is crucial for departments such as Environmental Services, Parks, Recreation, and Neighborhood Services, and Public Works, among others, to ensure compliance with safety regulations and provide high-quality training.

Citizen Impact

This agreement ensures that City employees receive necessary safety training, which indirectly benefits residents by promoting safer public services and work environments. No direct cost increase to residents is associated with this contract, as it is funded through existing departmental appropriations and Human Resources funds.

Confidence

high

Summary

This resolution proposes to reduce the annual permit and program monitoring operating fee for shared micro-mobility devices (e.g., e-scooters) from $139 per device to $100 per device. This adjustment is set to be effective January 1, 2026. The City has experienced a lack of applications from micro-mobility operators in its recent solicitation, which staff attributes to the current fee being higher than average and a barrier to entry. The reduction aims to make the City's fees more competitive with other municipalities, such as San Francisco ($100 per device) and Oakland ($90 per device), to encourage new operators and maintain the program. The current fee structure was estimated to generate $139,000 from 1,000 permits, but no revenue is anticipated without a fee adjustment. The new fee is projected to generate $100,000 from a similar number of permits.

Citizen Impact

Residents may see a return or increase in shared micro-mobility options like e-scooters, as the reduced fee aims to attract operators. This could improve transportation alternatives and potentially lower costs for users if operators pass on savings.

Confidence

high

Summary

The City Council is calling for two municipal elections: a Regular Municipal Election on Tuesday, June 2, 2026, and a Run-off Municipal Election on Tuesday, November 3, 2026, if necessary. These elections will be held to elect Council Members for Districts 1, 3, 5, 7, and 9 to four-year terms beginning January 1, 2027. The City is requesting consolidation of these elections with the County of Santa Clara's elections to streamline processes and reduce costs. The nomination period for candidates opens on February 9, 2026, and closes on March 13, 2026. The City Clerk will reimburse the County for election services.

Citizen Impact

Residents in Districts 1, 3, 5, 7, and 9 will have the opportunity to vote for their City Council representatives in June 2026. The consolidation with county elections aims for a more efficient voting process.

Confidence

high

Summary

This item seeks retroactive approval for the "Free Use" of the Janet Gray Hayes Rotunda for a private, invite-only Grateful Dead Celebration held on December 4, 2025. The event, sponsored by Council District 9 and Vice Mayor Pam Foley, was intended to commemorate the Grateful Dead's 60th anniversary. Although the standard resolution for free use requires events to be free and open to the public, this private event requires City Council approval. The City Council is asked to authorize the free use, approve the expenditure of funds, and accept donations of materials and services. The event is considered official City business as it highlights the city's musical heritage, supports economic development, boosts downtown activity, and strengthens the city's identity. The Rules and Open Government Committee recommended approval.

Citizen Impact

This is a procedural item to retroactively approve the use of a city facility for a past event. There is no direct financial impact or change in services for residents.

Confidence

high

Summary

This item concerns the settlement of a lawsuit filed by K’aun Green against the City of San José, et al. The lawsuit, case number 5:22-cv-02174-NC, arose from an officer-involved shooting on March 27, 2022, near the San Jose State campus. The plaintiff alleged serious physical injuries and emotional distress. The City Council is recommended to approve a settlement payment of $8,000,000.00 to resolve the case and dismiss all claims with prejudice. The settlement funds will be paid to "POINTER & BUELNA, LLP. – In Trust for K’aun Green". The City will bear its own costs, including attorney's fees. The payment will be funded by reallocating $8,000,000 from the Budget Stabilization Reserve to the General Liability Claims appropriation.

Citizen Impact

This settlement resolves a significant lawsuit against the city, avoiding further litigation costs and potential risks. The $8 million settlement will be funded by drawing from the city's reserves, impacting the amount available for other future needs.

Confidence

high

Summary

This report from the City Auditor presents the annual performance audit of Team San Jose (TSJ) for Fiscal Year 2024-25. The audit found that TSJ exceeded its performance targets across several key metrics.

Key Findings:

• Gross Operating Results: Achieved $6.5 million, significantly exceeding the target of $2.0 million (319% of target).
• Hotel Room Nights: Booked 133,513 room nights, surpassing the target of 117,000 (114% of target).
• Estimated Economic Impact: Generated over $95.3 million, exceeding the target of $78.1 million (122% of target).
• Theater Occupancy: Facilities were occupied for 96% of available days, exceeding the target of 93% (103% of target).
• Customer Satisfaction: Received 97% satisfaction ratings, exceeding the target of 95% (102% of target).

Based on these results, TSJ qualifies for the full performance-based fee of $300,000.

Citizen Impact

This audit indicates that Team San Jose successfully met and exceeded its performance goals for managing city-owned convention and cultural facilities, and for its Convention and Visitor's Bureau services in FY 2024-25. This suggests effective operation of these venues, contributing to the city's economy and visitor experience.

Confidence

high

Summary

This report details San José's intergovernmental relations efforts from August 29 to December 1, 2025, focusing on federal and state legislative advocacy. The City successfully sponsored SB 753, enabling quicker removal of abandoned shopping carts, and AB 476, enhancing metal recycling to reduce copper theft. It also supported SB 158, accelerating $500 million in Homeless Housing, Assistance, and Prevention (HHAP) Round 7 funding disbursement to September 1, 2026, and SB 63, authorizing a regional 14-year sales tax measure for transit on the November 2026 ballot.

Federal advocacy included securing $6.5 million in earmarks for projects like seismic and climate resiliency for rental units ($2 million), Yerba Buena Bridge construction ($2 million), Guadalupe River Trail extension ($1 million), sideshow deterrence ($500,000), and a copper theft surveillance system ($1 million). The City also protected its Measure E revenues and the Family Camp at Yosemite from adverse state legislation and regulatory actions.

Ongoing state advocacy includes fully restoring HHAP funding, securing flexible funding for emergency interim housing in the Affordable Housing Bond Act of 2026, and monitoring the projected $18 billion state budget deficit for FY 2026-2027. The City opposed legislation requiring 45-day notice for procurements (AB 339) and mandating remote public comment (SB 707), citing concerns about operational efficiency and managing disruptive behavior.

Citizen Impact

Residents will benefit from cleaner streets (shopping cart removal), reduced copper theft, and safer school zones (20 mph speed limit). Critical funding for homelessness services and affordable housing is being secured and expedited. The Yosemite Family Camp remains open, and efforts are underway to improve public transit through a potential regional sales tax. However, potential state legislation could impact the City's ability to generate revenue, potentially affecting local services or increasing costs.

Confidence

high

Summary

The City Council is adopting the 2026 Legislative Program and Legislative Priorities, which will guide the City's advocacy efforts in state and federal legislative sessions. Building on the five priorities approved in 2025, the program includes minor updates to descriptive summaries, such as enhancing resilience and expediting recovery in emergencies, and emphasizing outreach and sanitation for encampment services, with homelessness remaining the most pressing challenge.

Significant updates to the Legislative Program for 2026 include advocating for the full restoration of Homeless Housing Assistance and Prevention (HHAP) funding in the state's FY 2026-2027 budget and flexible funding in the Affordable Housing Bond Act of 2026. The City will also seek state and federal funding for international sporting event safety in the South Bay and for transformative rail projects and transit operations. New policy positions cover economic stability and mobility, regulation of advanced air mobility and drones, expansion of youth workforce development, addressing paramedic shortages, rideshare safety, promoting data center development, protecting city revenue, and enhancing recycling infrastructure.

In 2025, the City successfully advocated for $7.5 million in federal earmark funding for projects like seismic resilience, bridge construction, trail reconstruction, sideshow deterrence, copper theft surveillance, and park improvements. It also sponsored and supported key state bills related to abandoned shopping carts, copper theft, school zone speeding, and regional transportation measures. The upcoming state budget faces a projected $3 billion deficit, which will influence funding opportunities. The City is also contemplating new sponsored legislation on topics such as data centers, affordable housing construction, energy affordability, and childcare.

Citizen Impact

This program outlines the City's advocacy for policies and funding that will directly affect residents by increasing affordable housing and homelessness services, improving community safety and traffic infrastructure, and fostering economic and educational opportunities. It also aims to protect city revenues to ensure continued funding for essential local services.

Confidence

high

Summary

The City Council is considering the adoption of Council Policy 7-15, which prohibits the use of City-owned or City-controlled parking lots, vacant lots, and garages for civil immigration enforcement staging areas, processing locations, or operation bases. This policy aims to ensure City properties are used for their intended purposes and to preserve community trust. The policy was developed in response to events in other parts of the country where public facilities were commandeered for federal immigration enforcement. The Administration will be responsible for identifying applicable properties, posting standardized signage, and implementing physical barriers where appropriate. City employees are required to report any attempted or actual unauthorized use. The policy also includes provisions for providing standardized signage templates to private landowners and making "Know Your Rights" materials available to the public. This policy does not apply to existing contractual agreements and does not restrict the execution of lawful judicial warrants or the enforcement of criminal law. The City has identified approximately 11 City garages and parking lots and 75 library and community center sites that could be impacted, along with several hundred vacant parcels, though most vacant parcels are not applicable.

Citizen Impact

This policy prevents federal immigration enforcement agencies from using city property for staging, processing, or operational bases. This aims to foster trust between immigrant communities and local government, ensuring residents can access city services and public spaces without fear of federal immigration enforcement actions occurring on city land.

Confidence

high

Summary

The City Council is asked to approve a legal services master agreement with the law firm Hawkins, Delafield & Wood LLP. This agreement, not to exceed $4,000,000, will provide legal support for the San José-Santa Clara Regional Wastewater Facility (RWF) Capital Improvement Program (CIP) through June 30, 2030, with potential two-year extensions through 2034. The RWF, jointly owned by San Jose and Santa Clara, serves approximately 1.4 million residents and requires significant investment, estimated between $600 to $800 million over the next five years, to address aging infrastructure. Hawkins, Delafield & Wood LLP was selected for its extensive experience in public works construction projects, particularly design-build projects, and its familiarity with the RWF. This contract will support legal services for major projects including rehabilitating primary and secondary tanks, aeration tanks, and upgrading pump stations.

Citizen Impact

This contract ensures specialized legal expertise is available for critical upgrades to the regional wastewater treatment facility, which provides essential services to over a million residents. The funding is allocated from the Capital Fund, with future work subject to appropriation in annual budgets, meaning no immediate tax increase is required.

Confidence

high

Summary

The City of San José is approving a Design-Build Contract with Jacobs Project Management Co. for the Additional Digester Facility Upgrade Project (ESD 10199) at the San José-Santa Clara Regional Wastewater Facility (RWF). This project aims to improve the reliability and lifespan of the RWF's mesophilic digestion process, representing the final phase of anaerobic digester rehabilitation and the Biosolids Transition Strategy.

Initial Approval Details:

• Preliminary Services Fee: $9,542,366 for design development, preliminary investigations (geotechnical, hazardous materials, utilities, odor modeling), Basis of Design Report (BDR), 30% and 60% Design Completion Documents (DCD), and the Definitive Project Submittal (DPS).
• Design Contingency: $954,237 (10% of preliminary services) for City-approved scope changes.
• Early Work Packages (EWPs): Up to $10,000,000 for critical, schedule-driven activities like long-lead equipment procurement and final design, to be negotiated and approved separately.
• Total Initial Authorization: $20,496,603.

Overall Project Scope & Financials:

• Major elements include rehabilitating or replacing six mesophilic digesters, constructing a new Fats, Oils, and Grease (FOG) facility, struvite mitigation, and replacing Switchgear S2/S2A.
• The estimated construction phase (Guaranteed Maximum Price - GMP) is $164,500,000, with an additional $24,675,000 (15%) owner-controlled construction contingency.
• The total estimated project budget is $222,870,186, funded by the San José-Santa Clara Treatment Plant Capital Fund.
• Jacobs' compensation includes a 9% Design-Builder Fee and a 12% General Conditions Fee on Design-Build Period Costs (excluding certain items).

Timeline & Process:

• Preliminary services are expected to take 16 months, with a Notice to Proceed in January 2026.
• The project will return to City Council in August 2026 for Supplemental Environmental Impact Report (SEIR) approval, in November 2026 for EWP execution, and in August 2027 for GMP approval and construction commencement.
• Project completion is anticipated by November 2030.
• The contract utilizes a

Citizen Impact

This project is crucial for ensuring the continued reliability and efficiency of wastewater treatment for San José and surrounding communities. Upgrading the digester facilities will help manage sludge volume and produce biogas, contributing to environmental sustainability and public health. The initial funding approval allows for critical design and early procurement, aiming to reduce overall project delays and costs that could otherwise impact utility rates.

Confidence

high

Summary

This resolution declares an urgent necessity to bypass formal bidding for emergency repairs to the southern gate structure of Pond A18 at the San José-Santa Clara Regional Wastewater Facility. The structure, over 21 years old, is at risk of failure due to significant erosion and deterioration of its timber piles. Failure could lead to a levee breach, flooding property south of the pond, violating discharge permits, and potentially damaging the facility itself. The Directors of Environmental Services and Public Works are authorized to negotiate and award contracts for repairs, not to exceed $2,150,000, plus a 20% contingency ($430,000). This emergency declaration allows for expedited procurement and permitting, bypassing the typical 3-month bidding process and 9-12 month regulatory approval timeline.

Citizen Impact

This action is necessary to prevent potential environmental damage and flooding that could impact the region. It allows for the immediate repair of critical infrastructure at the wastewater facility to ensure its continued operation and protect surrounding areas.

Confidence

high

Summary

This item proposes the establishment of The Alameda Business Improvement District (TABID), a special assessment district for businesses in a specific geographic area. TABID will be funded by self-assessed fees from businesses within the district to support joint efforts such as physical maintenance, marketing, and promotion. The process involves public meetings and hearings, with formal action by the City Council expected on February 3, 2026, and the ordinance becoming law on March 27, 2026. Assessments will begin on April 26, 2026, collected annually with business tax renewals. The Alameda Business Association Board has been appointed as the Advisory Board to guide the district's activities.

Citizen Impact

Businesses within the proposed district will be subject to new assessments to fund local improvements and services. Residents may see benefits from enhanced maintenance and promotion of the business area, but the direct financial impact is on businesses.

Confidence

high

Summary

This item proposes the establishment of the Alum Rock Santa Clara Street Business Improvement District (ARSCSBID). The City Council will accept public comment on January 13, 2026, and take formal action on February 3, 2026. Business Improvement Districts (BIDs) are formed under California law to allow businesses to assess themselves for joint efforts like maintenance, marketing, and promotion. The Alum Rock Santa Clara Street Business Association Board has been appointed as the Advisory Board for the ARSCSBID. The process involves public hearings, ordinance readings, and an agreement with the business association, with assessments beginning on April 26, 2026. The BID will be renewed annually by the City Council.

Citizen Impact

Businesses within the Alum Rock Santa Clara Street area will be subject to new assessments to fund district improvements. This aims to enhance the business environment, potentially benefiting residents through improved local services and economic activity.

Confidence

high

Summary

The Santa Clara Valley Habitat Agency (Habitat Agency) is requesting approval from the City of San José to proceed with an amendment to the Santa Clara Valley Habitat Plan (Habitat Plan). This plan, established in 2013, aims to conserve habitat and streamline environmental permitting for projects impacting threatened and endangered species in Santa Clara County. The amendment is necessary after 10 years of implementation due to approaching take limits for certain species and habitat types, the need for administrative clarity, and requests for expanded coverage from partner agencies.

The proposed amendment includes several key changes:

• Adding seven new special status wildlife species for coverage, protection, and conservation.
• Expanding the Plan area boundary to the northwest for public and select project coverage, and to the northeast for conservation purposes only.
• Including Valley Water’s Stream Maintenance Program and the California Vegetation Treatment Program as covered activities.
• Adjusting cumulative impact assumptions and take limits for specific land cover types, habitats, or species, including an increase for burrowing owl occupied habitat.

Other administrative changes include updating agency names and clarifying definitions. The amendment process is funded by grants and is expected to undergo environmental review in early 2026, with adoption anticipated by the end of 2026. The City Council's approval today is a procedural step to allow the Habitat Agency to move forward with the amendment process, with a final adoption vote to follow.

Citizen Impact

This amendment will expand protections for additional wildlife species and potentially increase the geographic area covered by habitat conservation efforts. While no direct fiscal impact is anticipated for residents, it ensures continued streamlined environmental permitting for projects within the region.

Confidence

high

Summary

This ordinance, PP25-001, comprehensively amends San José's Title 19 (Subdivisions) and Title 20 (Zoning Code) to align with state housing laws, streamline regulations, and implement City Council direction. The Planning Commission recommended approval 9-0-1.

Key Amendments Include:

• Housing Production & Streamlining:
  • Senate Bill 9 (SB 9) Revisions: For R-1 single-family zones, new objective design standards include allowing narrower access corridors (4-7 feet or 12-15 feet) based on street width, increasing the Floor Area Ratio (FAR) from 0.45 to 0.65 with new lot coverage standards (e.g., 65% for 2,501-9,000 sq ft lots), and adjusting rear-yard height limits to 25 feet within 15 feet of the rear property line. The 50% garage frontage limit is removed. Owner-occupancy for lot splits is retained.
  • Two-Unit Developments in R-2 Zones: A new streamlined ministerial approval process is established for two-unit developments in R-2 two-family zoning districts, allowing up to 5 units (2 main, 2 detached ADUs, 1 attached ADU, 1 JADU) per lot.
  • Historic Properties: Streamlined ministerial development is allowed for two-unit projects on properties of "lesser significance" on the Historic Resources Inventory (not State/National Register or City Landmark), with demolition limited to less than 25% of exterior walls and new units requiring compatibility with existing structures.
  • Small Lot Subdivisions (SB 684/1123): Ministerial approval for up to 10 new lots and 10 housing units in multi-family and single-family zones, with a minimum density of 19.8 dwelling units/acre and unit size caps of 1,750 sq ft average. Attached Accessory Dwelling Units (ADUs) are allowed.
  • ADU Updates (SB 1211): Allows up to 8 detached ADUs on existing multifamily lots (not exceeding existing units) or up to 2 detached ADUs on proposed multifamily lots. New tree removal requirements are added (1:1 replacement for single-family, 4:1 for multi-family). ADU condominium requirements are revised to align with state law.
• Definitions & Use Regulations: New definitions for 'Group Home' (treated as single-family), 'Building, Main', and 'Lot Coverage'. Secondhand stores in Downtown no longer require a Special Use Permit and outdoor drop-off is prohibited. Off-sale alcohol consumption is permitted within established Entertainment Zone Boundaries without a Conditional Use Permit. Hydrogen fuel cell stations (SB 1418) receive streamlined permitting.
• Development Standards & Permits: Heat pumps are allowed to encroach 2 feet into setbacks (with a minimum 3-foot clearance). Mixed Use Neighborhood development standards are clarified. Special Use Permits can now be amended for project modifications without requiring a new permit. The Affordable Housing Density Bonus chapter is streamlined by removing specific state law citations and redundant local incentives.

Public and Commission Input: Public outreach between June 2024 and October 2025 focused heavily on SB 9 standards. Concerns were raised regarding potential impacts on privacy, open space, parking, and aging infrastructure due to increased density. The California Housing Defense Fund (CalHDF) specifically noted that the ordinance's proposed 800 sq ft size limit and 18 ft height limit for certain detached ADUs on multifamily parcels may violate state law, which allows unlimited size and 20 ft height (plus 2 ft for roof pitch) near transit. Residents also expressed strong opposition to SB 9 expansions in R1 titled neighborhoods, citing existing CC&Rs and potential legal challenges, and claiming a state moratorium on

Citizen Impact

These changes will increase housing options by allowing more duplexes, ADUs, and small lot subdivisions in single-family and two-family neighborhoods. Residents may see more development and increased density in their areas, potentially impacting privacy, on-street parking, and neighborhood character. New rules for heat pump installation and alcohol sales in entertainment zones may also affect daily life.

Confidence

high