Staff: SB 79 could enable thousands of homes in San José but estimates are theoretical

San José planning staff told the General Plan four‑year review task force that the state’s Senate Bill 79, scheduled to take effect July 1, 2026, could materially expand housing capacity near transit but that local yields will depend on site‑level realities.

Sanhita Gottschall, supervising planner for the General Plan team, said SB 79 (referred to in the presentation as the Abandoned and Affordable Homes Near Transit Act) overrides some local zoning on eligible sites within one‑half mile of certain transit stops and sets tiered height, floor‑area‑ratio and density standards. The city has 56 transit stations and roughly 4,000 properties within SB 79 buffer zones, Gottschall said.

Staff applied a parcel‑level methodology—similar to the approach used for the six‑cycle housing element and vetted by HCD—to neighborhood community commercial (NCC) parcels in SB 79 buffers. After removing parcels with existing residential uses, staff focused on nonresidential parcels that appear more likely to redevelop (vacant sites, parking lots and underutilized parcels with FAR ≤0.2) and on parcel sizes between 0.5 and 2.0 acres, which staff said are most common among current multifamily proposals.

Using those filters, staff reported a potential unit yield between about 1,900 and 6,600 units for the targeted NCC parcels in that size range. The presentation also showed a theoretical maximum of roughly 18,800 units if all nonresidential NCC parcels in that size band were developed to SB 79’s maximum densities. Gottschall emphasized the difference between theoretical capacity and realistic development potential, saying, “these estimates are based on a series of assumptions and actual housing production will likely vary.”

Commissioners questioned the underlying data and whether the city could provide a visual map of the parcels. Staff said they maintain a parcel spreadsheet with parcel numbers, acreage and building characteristics and that the city’s GIS/mapping tools contain much of the same data; staff offered to share the spreadsheet and to add an SB 79 layer to mapping tools where feasible.

Deputy Director Manira Sandhir reminded the task force that existing tenant protections and state no‑net‑loss rules require replacement of demolished affordable or rent‑restricted units, a constraint that makes redevelopment of occupied residential parcels more complex.

Staff said they vetted the methodology with the Department of Housing and Community Development during the housing element cycle and that the actual effect of SB 79 will become clearer only after implementation begins and applicants use the SB 79 pathway. The task force will receive updated summaries as staff monitor implementation; staff noted the task force meets again June 17 and the Planning Commission will consider final recommendations on June 24.