What the Measure Would Do

Measure V would authorize up to $450 million in general obligation bonds for the purpose of creating housing in San Jose that is affordable for working families, veterans, seniors, teachers, nurses, paramedics and other workers, individuals with disabilities, domestic violence survivors and the homeless.

Of the total $450 million:

• At least $150 million must be used to create housing affordable to extremely low-income households earning up to 30 percent of the area median income [1]
• At least $75 million must be used to create housing affordable to moderate-income households earning between 80 percent and 120 percent of the area median income [2]
• The remaining $225 million could be allocated to these categories or could be used to serve households of other income levels, including households earning between 30 percent and 80 percent of the area median income

The bond funds could be used to acquire land for the development of housing, to construct new housing and/or to acquire and rehabilitate existing apartments or homes.

The city estimates that the average tax rate required annually would be $8.15 per $100,000 of assessed property value.

The measure provides for oversight and accountability: the city auditor must produce an annual audit of the bonds, the city’s finance director must file an annual report with the city council and the city council must appoint a city resident committee to oversee the expenditure of the bonds.

The Backstory

Last fall, in recognition of the housing shortage in San Jose and around the region, San Jose Mayor Sam Liccardo released a five-year plan to create 25,000 housing units, of which 10,000 would be affordable. In June, the city followed that up with the release of its annual affordable housing investment plan and a new Housing Crisis Workplan.

The city has estimated that it would need $548 million to meet the city’s goal of 10,000 affordable units. This is in addition to funding anticipated from Santa Clara County’s $950 million general obligation bond for affordable housing in 2016 (Measure A). While San Jose projects can generally compete well for Measure A funding and other state funding programs, there is far more funding needed than there is currently available.

The city anticipates that this bond will be able to produce 3,550 additional affordable housing units, getting the city closer to its 10,000-unit goal. Between this bond and other funding sources, the city projects being able to fund 9,165 affordable units.

The city has not placed a general obligation bond on the ballot since the early 2000s. In 2000 the voters approved a $212 million library bond and a $228 million bond for parks and recreation, and in 2002 the voters approved a $159 million bond for emergency facilities improvements.

This measure was placed on the ballot by a 10-1 vote of the city council. As a bond measure, it requires two-thirds approval to pass.

Pros

• This measure will enable San Jose to support the development of workforce housing for a diverse set of residents, enabling individuals of all income levels — from those experiencing homelessness and those with special needs to working families and people with middle-wage jobs — to remain in San Jose.
• This funding will complement existing programs and be leveraged with funds from federal, state and county programs that often require a local funding match in order for a project to compete.

Cons

• Because it is so expensive to acquire and/or subsidize housing in San Jose, this bond would only be able to help a very small number of the people who cannot afford housing there.