San Jose, County Housing Authority adopt FY2026 Moving to Work plan; council adds six-month reportback

The San Jose City Council, sitting jointly with the San Jose Housing Authority and the Santa Clara County Housing Authority, approved the fiscal year 2026 Moving to Work (MTW) annual plan on April 15, adopting staff recommendations and directing follow-up reporting.

The plan, presented by Eric Sullivan, San Jose Director of Housing, and Preston Prince, director of the Santa Clara County Housing Authority, lays out four MTW activities for 2026 and a goal to explore broader use of tenant-based vouchers in alternative housing types. The activities include a shallow-subsidy pilot to reduce rent burden, a small direct-rental-assistance pilot that would pay participants directly, expanding construction and preservation authority under MTW, and clarifying referral language to explicitly include the City of San Jose.

The plan matters because MTW allows housing authorities flexibility to use federal Housing Choice Voucher funds in locally tailored ways. Prince said the authority has leased up more than 2,160 project‑based vouchers at 45 properties in San Jose and is pursuing additional vouchers tied to projects under construction and in the pipeline. Deputy director Angie Garcia Wynne outlined a multi-step process to assess whether interim housing units meet HUD housing quality standards, to identify policy or waiver needs, and to map contractual structures for nontraditional landlords if vouchers were to be used in interim sites.

Councilmembers asked how the activities would affect tenant choice and the existing voucher pool. Prince and Garcia Wynne said MTW is meant to test alternatives and that the housing authority does not intend to “terminate assistance to serve someone else,” but rather to find operational efficiencies and new tools that could support both interim and permanent housing outcomes. Garcia Wynne warned that more than 95% of agency funding comes from HUD and that a 1% cut to Housing Choice Voucher funding could equal roughly $5 million and affect about 200 households for the agency.

During council discussion, members pressed for concrete milestones. Councilmember Salas proposed — and Councilmember Kameh accepted — a friendly amendment directing the housing authority to “expand its partnership with the city of San Jose to apply flexible funding to support operations for at least one additional interim housing site” and to return to the council in six months with progress updates on: (1) exploring tenant‑based voucher use for alternative housing types and (2) opportunities to expand funding for additional interim housing sites. City staff said the six‑month reportback was feasible.

Councilmember Ortiz voiced concerns that diverting vouchers to interim housing could reduce options for households seeking tenant‑based vouchers to avoid homelessness and urged caution. Several councilmembers, including Mayor Mahan and Councilmember Cohen, urged urgency and innovation given the scale of unsheltered homelessness, saying MTW’s flexibility should be used to pilot scalable solutions.

The council adopted the resolution authorizing the executive director to submit and implement the FY2026 MTW plan. The motion passed 10–1, with Councilmember Ortiz recorded in opposition. The housing authority indicated it will submit the MTW activities to HUD and seek HUD approval by June 30.

The authority said the direct‑rental‑assistance pilot will start small (an initial test of about 10 households in 2026, with possible expansion in 2027) and be studied by a third‑party evaluator, the Manpower Development Research Corporation. Other MTW activities include preserving affordable housing and continuing project‑based voucher commitments in the city.

Councilmembers and housing authority staff said they will continue refining program evaluation measures and report back with data so the council can weigh expansion or alteration of pilots.