` TRANSMITTED VIA

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1 Leadership Board ` TRANSMITTED VIA Ron Gonzales, Chair Hispanic Foundation of Silicon Valley Janice Jensen, Vice Chair Habitat for Humanity East Bay/Silicon Valley Kevin Zwick, Treasurer Housing Trust Silicon Valley Kathy Thibodeaux, Secretary KM Thibodeaux Consulting LLC Shiloh Ballard Silicon Valley Bicycle Coalition Bob Brownstein Working Partnerships USA Christine Carr Silicon Valley Bank Rahul Chandhok San Francisco 49ers Katie Ferrick LinkedIn Amie Fishman Non-Profit Housing Association of Northern California Javier Gonzalez Google Poncho Guevara Sacred Heart Community Service Jan Lindenthal MidPen Housing Jennifer Loving Destination: Home Mary Murtagh EAH Housing Chris Neale The Core Companies Andrea Osgood Eden Housing Kelly Snider Kelly Snider Consulting Jennifer Van Every The Van Every Group Staff Leslye Corsiglia Executive Director March 27, 2017 The Honorable Mayor Liccardo and Members of the City Council City of San Jose 200 E. Santa Clara Street, 18 th Floor San Jose, CA Dear Mayor Liccardo, Vice Mayor Carrasco, and Councilmembers Arenas, Davis, Diep, Jimenez, Jones, Khamis, Nguyen, Peralez and Rocha: Re: Approval of the Fiscal Year Mayor s March Budget Message On behalf of our members and the undersigned organizations, SV@Home writes today to request that the City, as part of the FY budget process, end the backstop of Community Development Block Grant (CDBG) funds to cover Section 108 debt incurred by the former San Jose Redevelopment Agency and develop a plan to reimburse the nearly $11 million in CDBG funds that have been diverted since the time of redevelopment dissolution. The projected FY payment is $1.9 million. This is approximately 23% of the available CDBG entitlement. CDBG funds offer critical support to programs and activities that target lower-income neighborhoods and people. Priorities funded by CDBG include: job training and readiness programs offered by the Downtown Streets Team, which provides job training and experience to homeless residents, acquisition and rehabilitation of homes for the homeless, and the provision of rental assistance to veterans and other lowerincome populations. In years past, the San Jose Redevelopment Agency borrowed funds from the US Department of Housing and Urban Development under the Section 108 loan program to implement projects, including the Avaya Soccer Stadium and the 88 Condominiums/Safeway. The Agency was responsible for paying the annual debt service on some of the 108 debt, and had structured the loans so that, in the event of default, they would be backed by redevelopment tax increment. At the time of dissolution in 2011, the Redevelopment Agency owed $29.7 million to HUD, and was paying over $2 million in annual debt service. Given the Agency s insolvent position, it did not have sufficient funding available to pay its debts at the time of dissolution, including the Section 108 loans. Despite the fact that the 108 loans were an obligation of the Agency, the CDBG program, not the RDA Successor Agency, was held liable for the repayment of the 108 loans. And while other City payments for RDA obligations are included on a list for future repayment, the CDBG loan payments are not included. As a result, these CDBG funds have been lost to the Program and the 350 W. Julian Street, Building 5, San José, CA info@siliconvalleyathome.org

2 Honorable Mayor Sam Liccardo and members of the City Council Re: FY Budget Community Development Block Grant Program March 23, 2017 Page 2 of 2 community. In summary, these programs are vitally important to the City s lower-income households. We request that the City hold the CDBG Program harmless in FY by paying the Section 108 debt service from another fund, and that the City pursue ways to reimburse the CDBG Program for the redevelopment debt it has paid. If this funding is restored, the City could invest these funds to help lower-income families access affordable housing, address neighborhood improvement needs, and implement jobs programs. And, in closing, while President Trump has suggested zeroing out the CDBG Program in the FY2018 federal budget, there is strong federal support for the Program due to its community benefits, and it is likely to survive. San Jose can confirm the value of the CDBG Program by spending these funds on programs rather than debt service. Sincerely, Pilar Lorenzana, Deputy Director, SV@Home Kevin Zwick, Chief Executive Officer, Housing Trust Silicon Valley Jennifer Loving, Executive Director, Destination: Home Patricia Gardner, Chief Executive Officer, Silicon Valley Council of Nonprofits Kyra Kazantzis, Directing Attorney, Law Foundation of Silicon Valley Eileen Richardson, Chief Executive Officer, Downtown Streets Team Joel Robert, Chief Executive Officer, PATH Sandy Perry, President, Affordable Housing Network of Santa Clara County Kiyomi Honda Yamamoto, Regional Representative, Greenbelt Alliance 350 W. Julian Street, Building 5, San José, CA info@siliconvalleyathome.org

3 Hon. Mayor Liccardo and City Council City of San Jose 200 E. Santa Clara Street San Jose, CA Submitted Electronically March 28, 2017 Re: Approval of the Fiscal Year Mayor s March Budget Message (Item 3.5 on March 28, 2017) Dear Mayor Liccardo and Councilmembers, Last year, SPUR endorsed both June s Measure B and November s Measure G in the hope that some of these revenues will be dedicated to investing in the city s long-term future.1 In particular, we recommend: 1. Reflect the city s recently approved priorities in the budget. A few weeks ago, City Council voted on the city s policy priorities for the year, including updates to urban design guidelines in commercial areas. We encourage Council to allocate appropriate resources to these priorities, so that city departments can turn these priorities into actionable policy in a timely manner. We particularly support allocating funding to update San Jose s urban design guidelines, which will guide all new development in urban villages. Without updated guidelines, new development will not translate into the walkable and livable communities that San Jose wants and that support economic growth. 2. Add staff to support the city s long-term planning and policy efforts in Planning, Building and Code Enforcement, the Office of Economic Development, the Department of Transportation and the Department of Public Works. The budget message directs the City Manager to prioritize filling PBCE positions that serve small business customers for needs such as tenant improvements and permits. While this is an important and unfilled need, we reiterate that additional resources are also needed to achieve the city s ambitious goals for transformation and to become future-ready. We recommend that the city prioritize adding and backfilling long-term planning positions to PBCE, DOT, OED and Public Works first. The lack of investment in future-oriented planning and policy is like the city s deferred road maintenance problem; not investing today costs us more in 1 Our full proposed spending framework for Measure G can be found here: Measure G Proposed Purpose and Use of Funds pdf

4 the long-run. We have not invested in the future and this is starting to hurt the city in terms of its economic competitiveness and its ability to capitalize on major transportation investments like BART and high-speed rail. Transportation projects like these can be catalytic and lead to the economic transformation of our city if we plan and make the changes we need to make, such as improvements in our pedestrian infrastructure and proactively leveraging private investment. In addition, we are living in a rapidly changing environment in terms of mobility, technology, and our economy and will not be able to keep up with let alone get ahead of the physical and social impacts of these changes without investing in planning in a real way. Thank you for the opportunity to provide input on the Mayor s March Budget Message and budget deliberations. Please let us know if you have any questions or concerns at talvarado@spur.org or Sincerely, Teresa Alvarado San Jose Director 2

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6 engage. learn. build