February 23, 2023
February 2023 Spotlight: Housing
Hello Gilroy! With all that we hear about housing in the Bay Area, from State allocation meant to increase housing supply in a wide range of affordability to various forms of shelter for those unable to pay for housing at all, I’d like to focus this month on how Gilroy implements projects and programs to address housing needs and provide assistance to families and individuals that are experiencing or at risk of homelessness, what housing projects are in the works, what projects are in the pipeline, and what it means financially to shelter those who do not or cannot pay for housing, regardless of what’s available. We will look at housing from the 3P approach – affordable housing production, preservation, and protection.

Gilroy Community Development Director, Sharon Goei, will join me at the next Conversation and Coffee with the Mayor in Council Chambers on March 4 at 9:30am. Please join us both to answer questions and engage in community discussion on this very important and sometimes complicated and emotional topic.

Mayor Marie Blankley, CPA
About Community Development Director, Sharon Goei

Sharon Goei started as Gilroy’s Community Development Director in August 2022. She has over 20 years of experience in local government in a variety of fields related to development. She worked in the cities of Milpitas, Santa Clara, and Walnut Creek, after starting her career in the private sector. She has a bachelor’s and master’s degree in civil engineering from UCLA. She is a registered civil engineer and LEED Accredited Professional. “Gilroy is experiencing significant growth,” said Sharon, “and I am proud to be part of our team that is working hard to make a positive impact in Gilroy during this period of remarkable change.”

Overview from the Mayor

Gilroy’s Community Development Department consists of 25 staff in Planning, Building, Housing, Fire Prevention & Wastewater Pretreatment, Code Enforcement, and Customer Service. All of these divisions, together with those of other departments, work to ensure Gilroy residents have quality neighborhoods and housing. Every eight years, all cities in the State of California are provided with a Regional Housing Needs Allocation (RHNA) that quantifies the need for housing in number of units over a range of income categories. The threshold for income categories is based on specific percentages (80% for low income, 50% for very low income, and 30% for extremely low income) of Santa Clara County’s median household income (the midpoint annual household income where half of the county households earn more than that midpoint, and half earn less). Today, our County’s Area Median Income (AMI) for a family of 4 is $168,500, and households earning less than 80%, 50% and 30% of AMI qualify as low income, very low income, and extremely low income, respectively.

It is difficult to attract developers to build housing in the 30% and 50% of AMI categories in meaningful numbers without measures that simultaneously reduce the costs to build, such as environmental regulations, materials and labor, for example. In 2016, Santa Clara County voters passed the Measure A Affordable Housing Bond to provide nearly $1 billion to subsidize the construction of affordable and supportive housing throughout the County that benefits the most vulnerable and lowest income residents including special needs populations. Gilroy has one Measure A-funded housing development that is complete and one in the pipeline. The completed project is the Gateway Apartments on Monterey Street south of Luchessa, consisting of 75 affordable units.

In the pipeline is a housing development at 8th and Alexander Street, a site that is publicly owned and near the Gilroy Transit Center. The proposal is still in the community outreach phase and was initiated by the Gilroy City Council to take advantage of Measure A funding after a similar proposal by Valley Transportation Authority jeopardized available transit center parking that would be needed once viable and thriving public transportation services are present in Gilroy. In furtherance of its support of the 8th and Alexander development, the City intends to contribute over $2 million by waiving impact fees.

As the State of California pushes all cities to increase housing supply, we face increasing challenges for city services to keep up. Additionally, today’s employment and transportation opportunities for Gilroy residents force most into their cars to reach employment destinations to the north, worsening highway congestion conditions as housing development continues farther and farther away from job centers. Developers pay local impact fees for water, sewer, local roadways, and for schools on behalf of Gilroy Unified School District. However, highways and transit service are out of our hands and are critical elements to a growing population. The same is true for social services and public health, needs that expand as population increases, but for which we depend on County resources to fund. State Senate and Assembly bills continue to change regulations for housing to which cities, city services, and residents must adjust.
Current Housing Projects in Gilroy

There is currently a wide variety of housing projects in Gilroy.

Under Construction
  • 1st Street and Kern Avenue: 120-unit affordable apartment development
  • Hecker Pass Highway and Santa Teresa Blvd.: 100-unit affordable apartment development
  • Glen Loma Apartments at Luchessa Avenue and Miller Avenue: 86-unit affordable apartment development (part of 158-unit development)
  • Glen Loma Town Center: 124-unit condominium development (38 units completed, 70 units under construction, 16 units permits pending request)
  • Various single-family homes throughout Gilroy: Over 100 single-family homes, mostly in subdivisions
  • Accessory dwelling units (ADUs) throughout Gilroy: 8 attached ADUs and 21 detached ADUs

Soon to be Constructed
  • Monterey Street at 1st Street: 10-unit residential and 2-unit commercial mixed-use development
  • Various single-family homes throughout Gilroy: Over 100 single-family homes, mostly in subdivisions
  • Accessory dwelling units (ADUs) throughout Gilroy: 9 attached ADUs and 25 detached ADUs

Entitlement Issued, Pending Building Permit Application
  • Royal Way adjacent to Gilroy High School: 45-unit townhome development
  • 6th Street and Princevalle Street: 19-unit single-family development
  • Gurries Drive and Hanna Street: 4-unit townhome development

Application Submitted for Review
  • 1st Street and Santa Teresa Blvd.: 202-unit townhome development
  • Monterey Road south of 10th Street: 94-unit affordable apartment development
  • Miller Avenue at Santa Teresa Blvd.: 53-unit single-family development
  • Chickadee Lane and Cohansey Avenue: 12-unit mixed-use development
  • Ronan Avenue east of Church Street: 6-unit apartment development

Housing Production and Regional Housing Needs Allocation (RHNA)

In accordance with State law, every city in California is assigned a housing unit target, representing its share of the state’s housing needs for an eight-year period. This target, or Regional Housing Needs Allocation (RHNA), is based on the State’s overall projection for regional growth. Once a city receives its allocation, it must then update its eight-year housing plan known as the Housing Element to demonstrate how it will accommodate the assigned units across various income categories.

Gilroy has had remarkable housing production in all income categories. As shown in the table below, the City has exceeded the 2015 – 2023 RHNA for the low-income category (429%) and above moderate/market rate category (302%), as of December 31, 2021. To count towards RHNA, building permits must have been issued in the corresponding calendar year. The issuance of building permits allows the applicant to begin construction. While City staff is still gathering data for 2022, Gilroy has met at least 66% of the very low-income category and 41% of the moderate-income category.

Gilroy’s allocation for the 2023 to 2031 period is shown in the table below.

On October 31, 2022, the City submitted the Draft 2023 - 2031 Housing Element to demonstrate how it will accommodate the 2023 – 2031 RHNA to the California Department of Housing and Community Development (HCD) for review. On January 27, 2023, HCD provided comments on the draft. Staff will revise the draft based on HCD comments and bring it back to the City Council for review prior to sending a revised draft to HCD for additional review and certification. For more information, please visit our Housing Element website.
Because RHNA’s levels of affordability are determined using the median household income for the entire county (Palo Alto to Gilroy), Gilroy residents earning less than residents in other cities in Santa Clara County are put somewhat at a disadvantage, because it is more difficult for them to qualify for the same “affordable” housing that households with higher income can qualify for.   
The following 2022 income ranges define very low, low, and moderate-income in Santa Clara County. New income limits (i.e., 2023) are typically released between April and May of each year.
  • Very Low Income (31 – 50% AMI): between $50,551 and $84,250 for a family of four; $40,451 and $67,400 for a family of two.
  • Low Income (51 – 80% AMI): between $84,251 and $131,750 for a family of four; $67,401 and $105,400 for a family of two.
  • Moderate Income (81 – 120% AMI): between $131,751 and $202,200 for a family of four; $105,401 and $161,750 for a family of two.
Notice that a family of four in Santa Clara County earning $84,000 annually is considered Very Low Income.
Alexander Station is an affordable apartment project in Gilroy that began accepting renters in 2018. Of the 262 units in this development, 233 are for low income, 27 units are for very low-income and 2 units are for property managers. Alexander Station was not built with Measure A dollars and, therefore, was not required to meet Measure A criteria for minimum housing units below the low-income category. In contrast, the housing development contemplated at 8th and Alexander has been allocated Measure A dollars and may consist of about 57 units, 50% of which would be low income, 25% very low income, and 25% extremely low income.
Non-permanent, Temporary or Emergency Housing

This type of housing comes at no cost to inhabitants and can exist in several forms (tiny home campuses, modular structures, stackable structures, RV/trailer parking, etc.), all of which are meant to provide no-cost forms of shelter on a temporary basis on property that is currently underutilized and would still be available in the future by removing or relocating the housing structures. The financial burden of providing such sites lies primarily in the ongoing supportive services that are required of any subsidized housing or shelter program (e.g., behavioral services, case management, efforts to employ or educate, security costs, maintenance services). For those who are not in a position to pay for housing at all regardless of what’s available, the cost of supportive services can be substantial. A good example is a temporary/emergency housing site in San Jose that opened in 2020 and is operated by HomeFirst, the same service provider used by the County for the Gilroy Armory. HomeFirst’s annual operating cost for this site of 80 inhabitants is $3.3 million, or $42,000 per person per year. While meant for stays of up to 6 months, the majority of the inhabitants at this site have been residents since it opened in 2020. The same is true of a site I toured in San Francisco. Operating costs are ongoing, requiring funding year after year, and at a magnitude sufficient to address the hundreds of people who are unhoused and in need of supportive services in Gilroy. Funding for operating costs through County and State grant programs can assist, but at a service price tag of over $40K per person per year, they will not go far. 
The Gilroy City Council has dedicated significant time and resources to identify and implement measures that address the unhoused community in Gilroy. For information on what the City of Gilroy is currently doing to address this complicated issue, please visit this link to our Unhoused Resources and Efforts website: https://www.cityofgilroy.org/unhoused
Preservation of Existing Housing and Protection from Displacement

The Housing Choice Voucher program, known as Section 8 program, is a 100% federally-funded rental assistance program for qualifying households living in privately owned rental units. In Gilroy, the Santa Clara County Housing Authority manages the program. Currently, 933 Gilroy households, with a total of 2,386 family members in these households, receive Section 8 rental assistance.
The City of Gilroy supports the preservation of long-term housing stability and affordability. By implementing the City’s allocation of the federal Community Development Block Grant, the City provides $140,000 of funding annually to Rebuilding Together Silicon Valley to implement a wide range of home repair, accessibility, mobility, and rehabilitation improvements for low-income homeowners. Affordable housing is preserved by providing critical safety home repairs and accessibility modifications for low-income, often elderly, homeowners at no cost so that these residents are not displaced and can remain in their existing homes in a safe and healthy environment.
In the area of protecting current residents from displacement to prevent homelessness, Gilroy has implemented new resources this fiscal year. The City received Permanent Local Housing Allocation funding from the State through application and partnership with Santa Clara County. As a new resource, the City is implementing $474,000 in program funds during the first two years. By partnering with the County and a broad range of community-based organizations, the City is expanding homelessness prevention and basic needs services to assist Gilroy families and individuals who are experiencing, or at risk of, homelessness.
  • With $110,000 over two years, St. Joseph’s Family Center provides emergency rental assistance, utility assistance, and other supportive programs that help diminish the risk of becoming homeless.
  • With $40,000 over two years, Project Sentinel provides fair housing services and investigates complaints to address housing discrimination for Gilroy residents.
  • With $40,000 over two years, Project Sentinel provides a landlord-tenant counseling and dispute resolution program to help resolve housing conflict and protect Gilroy residents from displacement. 
  • With $40,000 over two years, Community Agency for Resources Advocacy and Services provides rental and deposit assistance to prevent homelessness for Gilroy families and individuals.
  • With $80,000 over two years, South County Compassion Center provides services to unhoused Gilroy residents to meet their basic needs and to connect them with services that can help them attain permanent housing.
  • With $70,000 over two years, St. Joseph’s Family Center provides training and employment readiness to prepare individuals that are homeless or at risk of homelessness for stability and greater self-sufficiency.
  • With $54,000 over two years, The Health Trust delivers meals to low-income and homebound seniors at risk of food insecurity, allowing them to remain in their homes.
  • With $40,000 over two years, Silicon Valley Independent Living Center provides Gilroy residents with disabilities counseling, emergency rental assistance, and housing search services to obtain safe, affordable, and accessible long-term housing.

As can be seen above, Gilroy is allocating and implementing federal and state grant funding to assist Gilroy’s vulnerable communities and create safe and healthy neighborhoods for all.

Community Outreach on Housing Services

Gilroy has been expanding community outreach and education on housing resources by partnering with community-based organizations to host informational workshops and webinars to inform residents of a variety of assistance programs and funding opportunities. The workshops are usually held in English and Spanish, or English with Spanish interpretation, to reach as many residents as possible. In addition, the Mayor is dedicating next month's in-person Conversation & Coffee with the Mayor to housing and housing services for all in our community to join. As always, Spanish interpretation is available upon request. Saturday, March 4 from 9:30-11am in Council Chambers.
In the past few months, Gilroy has held workshops on the California Housing Finance Agency ADU Grant Program, Santa Clara County Empower Homebuyers Down Payment Assistance Program, and Rebuilding Together Silicon Valley’s free home repair program. The City is planning more workshops to inform the Gilroy community of housing resources.