Santa Clara and San Jose Officials Clash over Massive City Place Project

Santa Clara, San Jose, Office, City Place, Housing, Palo Alto, Bay Area, Silicon Valley

city place santa clara

By David Goll

Though it has generated a spark of controversy between municipal neighbors, the enormous proposed City Place mixed-use development is progressing through Santa Clara’s planning pipeline. Certification of the environmental impact report by the Santa Clara City Council on the 239-acre project that could eventually encompass more than 9 million square feet of office, retail, entertainment and residential development north of Levi’s Stadium could come in early 2016, said Julio Fuentes, city manager for the city of 122,000.

[contextly_sidebar id=”hTByUoOYUxrDpXK7SqZOBi0ft0IzkzDe”]But the current makeup of the project has drawn criticism from officials in neighboring San Jose, who say the proposed 1,360 new housing units in City Place won’t come close to accommodating workers for the nearly 25,000 jobs that could be created by the development. They say it will worsen the region’s jobs/housing imbalance that hits particularly hard in the Bay Area’s largest city. San Jose already has Silicon Valley’s worst ratio for providing jobs for its employed residents, far below such neighbors as Santa Clara and Palo Alto.

“The project as currently proposed will exacerbate the region’s housing crisis as there are no plans to include affordable housing,” wrote Harry Freitas, San Jose planning director, in a letter to Santa Clara officials in early December. “This will add pressure on neighboring cities, such as San Jose, to provide housing for all sectors of the workforce.”

Freitas contends only 13.5 percent of City Place employees will be able to find housing in the city Santa Clara, leaving neighboring cities to provide more than 15,000 housing units for those workers.

“The impact/burden of induced housing demand and population on San Jose will result in the need for additional services provided by the city (police, fire, parks, etc.),” Freitas wrote. “Cities that have significant financial challenges, i.e. jobs-poor cities like San Jose, provide the bulk of public services to our most in need (poor) communities in the South Bay. Jobs-rich cities don’t carry that financial burden.”

Freitas also voiced concerns with the project’s impact on traffic congestion, air quality and loss of wildlife habitat. Some have speculated San Jose officials might consider taking future legal action against the project.

Fuentes said he wasn’t surprised by San Jose’s objections to City Place, some of which had been expressed during earlier meetings between officials of both cities. He said Santa Clara would have included more housing in the project, but there are concerns about the safety of landfill upon which City Place would be built. Fuentes added his city takes its responsibility for creating both jobs and residential units seriously.

“We’re working on a number of housing projects, and we plan to generate more than 13,000 housing units over the next several years,” he said. “We could have up to 25,000 jobs created by City Place, but it will be a phased development that could take 20 years to complete. This won’t all be coming at one time.”

Sam Liccardo, San Jose’s mayor, said he has made improvement of his city’s jobs/housing imbalance a major priority since being elected a year ago. A problem since the 1970s, it seems to be worsening, with San Jose’s jobs-per-employed-resident at .84. That compares to 3.0 in Palo Alto, 2.0 in Mountain View and 1.5 in Santa Clara. With 1 million residents making it the nation’s 10th largest city, San Jose has the worst such ratio of any major American city, Liccardo added.

“The bad news is the numbers haven’t moved much over the past four decades,” he said. “The good news is we have lots of (job-generation) activity now and on the horizon. But we have a very large ship to turn.”

North Santa Clara County—with its high-tech industry magnets of Stanford University and the Sand Hill Road venture capitalist-rich corridor—has been a logical and traditional location to launch startup companies. But Liccardo said the increased urbanization and sophistication of downtown San Jose is attracting more high-tech companies and their demographically desirable young employees. And nearby San Jose State University now produces more engineers for Silicon Valley companies than any other university.

Another potential bright light for the Capital of Silicon Valley is the proposal by tech giant Apple to develop more than 4.1 million square feet of office, manufacturing and research and development space in north San Jose over the next 15 years, generating up to 20,000 jobs. The project is expected to be reviewed by city planning officials in early 2016.

For his part, Fuentes said he and other Santa Clara officials are eager to work out any potential disagreements over City Place with San Jose city leaders and looks forward to future discussions. But, he also predicts once it receives a green light from the Santa Clara City Council, construction on the mega-project could begin in 2017.

“As long as we continue to talk, we can hopefully avoid conflicts,” Fuentes said. “But, make no mistake, we do plan to move forward with the City Place project.”

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