Tenant Preferences That Fight Displacement

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San José’s Tenant Preferences Program to Fight Displacement requires certain affordable housing properties to make available a portion of their affordable apartments, that otherwise would be available to the general public, for applicants who meet certain criteria and are most in need of affordable housing. To ensure equity and access, all tenant preferences must be consistent with fair housing laws. They must be implemented as part of a pattern of policies to promote inclusivity and attempts to integrate all types of people into the community.

Tenant Preferences Program Draft Administrative Guidelines Now Available

The Housing Department is seeking public comment on the Draft Tenant Preferences Program Administrative Guidelines. The public comment period will be open from November 4, 2024 until December 4, 2024. The purpose of the administrative guidelines is to clarify details and support implementation of Resolution No. 2024-84 passed by Council on March 26, 2024.

View the draft Administrative Guidelines.

Submit comments by sending an email to hsg-policy@sanjoseca.gov with “Tenant Preferences Program Draft Administrative Guidelines” in the subject line.

Background on Tenant Preferences in San José

In 2020, City Council approved the Citywide Residential Anti-Displacement Strategy (Anti-Displacement Strategy) and directed staff to start work on priority recommendations. Recommendation #2 from the Anti-Displacement Strategy was to Establish a Neighborhood Tenant Preference and Anti-Displacement Preference for Affordable Housing.

On March 26^th, 2024, the San José City Council approved the Tenant Preferences Program to Fight Displacement (item 8.2) and approved its implementation in affordable housing developments, effective immediately.

TWO ways to Qualify

The Tenant Preferences Program is designed to mitigate residential displacement. It would assist two categories of residents:

Residents in High-Displacement Census Tracts: Designates 20% of apartments in new and existing affordable housing properties for low-income applicants who live in certain areas of San José that have a high likelihood of displacement. Eligible residents would live in census tracts categorized as ‘high-risk’ or ‘undergoing displacement’ by a credible, authoritative external source (such as the Urban Displacement Project at U.C. Berkeley).

Map of Census Tracts Undergoing Displacement or At-Risk of Displacement:
https://urban-displacement.github.io/edr-ca/maps/CA_estimated_displacement_risk_map_v20.html

Goal: Increase the likelihood that lower-income renters at highest risk of displacement in San José can access affordable homes and stay in San José, either in their current neighborhoods or wherever they choose.

Residents in Same Neighborhood: Designates 15% of apartments in new and existing affordable housing properties for lower-income applicants who already live in the same San José City Council District as the property.

Goal: Increase the likelihood that low-income renters in San José can remain in their neighborhoods and improve their housing stability and costs. Another benefit is to make clear the benefits of affordable housing development to neighborhood residents likely to be impacted by the development or rehabilitation process.

BACKGROUND

All prospective applicants are strongly encouraged to apply to as many affordable housing developments as possible, regardless if a property is implementing the program. To find the latest listing of affordable housing available in San José, visit the City’s Doorway affordable apartment portal at: https://housing.sanjoseca.gov/

This section will be regularly updated to list San José’s affordable housing properties accepting the tenant preferences program.

Meeting	Date
City Council - memo - slides - recording	Mar 26, 2024
City Council Community and Economic Development Committee - memo	Feb 26, 2024
Affordable Housing Developer Roundtable #2 - slides - recording	Dec 12, 2023
Amigos de Guadalupe Community Meeting - slides	Oct 26, 2023
Housing and Community Development Commission - memo - slides - synopsis	Sep 14, 2023
Various stakeholder meetings	Aug - Oct 2023
SV@Home Policy in Action: Local Tenant Preference Policy - slides - recording	Sep 29, 2023
In-person Community Meeting - slides	Aug 31, 2023
Virtual Community Meeting - slides - recording	Aug 24, 2023
Affordable Housing Developer Roundtable	Jul 27, 2023

SAN JOSÉ TENANT PREFERENCES PROgram TO FIGHT DISPLACEMENT – PROGRAM FRAMEWORK
Set-aside of Apartments	35% of all restricted affordable apartments otherwise available to the general public in a subject property: No more than 15% of apartments set aside for applicants living in the same neighborhood (City Council District) as the property, and 20% of apartments set aside for applicants living in displacement tracts Set-aside of apartments will be a commensurate mix of all apartments for the general public (number of bedrooms and affordability levels).
Applicant Eligibility	Lower-income San José residents (≤80% AMI) are eligible if they: Live in definitive and probable displacement tracts, as defined by the U.C. Berkeley Urban Displacement Project, and/or Are at-risk of displacement as they currently rent a home in the same Council District as a subject development. See current income limits by household size for more information.
Subject Properties	City-funded affordable developments, including those for seniors. Developments negotiated through Development Agreements. Existing affordable housing properties when documents are updated (on a deal-by-deal basis). Any affordable housing in San José on which public agencies want to apply preference, even if no City funding. State-funded affordable developments that meet the above criteria (pending approval by the state Department of Housing and Community Development).
Phase-In	All new and renegotiated City-funded affordable housing developments in the pipeline and early in construction at the designated effective date of the San José City Council’s resolution.
Housing Department roles and responsibilities	Integrate preferences into San José’s Affordable Housing online renter application portal (Doorway) Doorway identifies applicants who are eligible for one or both tenant preference categories based on current address Create program implementation manual for property managers Develop program administrative guidelines with public feedback Integrate tenant preference administration language into loan documents Approve unit set-aside plan, lease-up plan, and tenant selection plan prior to advertising Ensure program administration by annual compliance verification
Property Manager Roles and Responsibilities	Ensure property profile is set up on Doorway portal Advertise to the public that alternative documentation for undocumented residents is accepted Identify tenant preference set-aside that is a commensurate share of overall general unit mix and obtain City concurrence Receive list(s) of applicants, including those eligible for one or both tenant preferences, through Doorway Review applicants’ qualifications and supporting documentation (alternative documentation must be accepted) Verify current address with two forms of evidence & confirm address is eligible for tenant preferences Determine income and all other eligibility criteria are met Maintain waitlist of adequate size ongoing Supply evidence as requested for City annual compliance verification
Housing Department Engagement and Education	Create webpage with program materials Educate transaction teams on tenant preferences to address any questions or concerns Hold general information sessions with property managers following the passage of the Tenant Preferences Program Meet with property management company on each transaction Support property managers’ need for marketing assistance, if any Conduct community presentations at or near new affordable properties Create and distribute educational materials for the public to community partners, City-owned sites (i.e., libraries, community centers), and affordable housing sites
Annual Compliance Process	For properties subject to tenant preferences, property managers will need to demonstrate annually: Commensurate unit mix is met as indicated on rent rolls Set-asides are correct
Non-Compliance	Waitlist procedures adhere to program guidelines Tenant selection plan describes tenant preference procedures Acceptance of alternative documents has been advertised Property listing is active in Doorway portal and Doorway online digital application is used for initial lease-up (if appropriate) and waitlist openings First Violation: Meeting to re-educate property management staff, and 6-month follow-up with City and property managers Second Violation: City issues formal letter of non-compliance to owner and property manager Third Violation: City issues formal letter of non-compliance to owner, property manager, lenders, and other funders The City reserves the right to pursue any of its remedies under loan documents in the event of continued non-compliance.
Tenant Application Process	Apply for a specific development that is accepting applications through the Doorway tenant application portal or through a paper application Provide current residential address, household size, household income Read about tenant preference and automatically be identified for appropriate criteria through Doorway Opt-out of tenant preferences program, if desired