REPORT TO PLANNING COMMISSION
SUBJECT
Title
Review of the Proposed FY 2026/27 and FY 2027/28 Biennial Capital Improvement Program Budget for Conformity with the City of Santa Clara 2010-2035 General Plan
Report
BACKGROUND
Pursuant to Government Code Section 65401and City procedures, the Planning Commission is charged with reviewing the proposed Capital Improvement Program (CIP) Budget to determine its consistency with the adopted City of Santa Clara 2010-2035 General Plan. The City Council reviews the Planning Commission’s findings prior to acting on the budget. The proposed Biennial Capital Budget is scheduled to be presented at two planned City Council Study Sessions in May 2026 with the public hearing scheduled for June 9, 2026. While the draft CIP Budget may undergo some adjustments before the City Council’s public hearing, the revisions are expected to be minor and generally consistent with the projects presented in this draft document. If necessary, any significant additions can be subsequently brought before the Planning Commission.
DISCUSSION
The Capital Improvement Program (CIP) is a five-year expenditure plan that guides the City in the planning, scheduling and budgeting of capital investments for its infrastructure and facility needs. The capital projects are aligned to the Adopted City Council Strategic Pillars and the FY 2026/27 Budget Principles. These Budget Principles provide a framework for budget review and development, ensuring fiscal stability by considering both the short and long-term impacts of any funding decisions and include:
1. Make decisions within the context of the City’s Code of Ethics and Values, especially being Fiscally Responsible, Communicative, and Service-Oriented.
2. Consider budget decisions with long-term implications taking into account data from the Ten-Year Financial Forecast.
3. To the extent possible, align ongoing expenditures with ongoing revenues to avoid negative impacts on future budgets and maintain the City's high financial management standards.
4. When considering budget augmentations and service restorations, factor in the long-term ability to support the additions and the potential community and organizational disruption if funding is not available in the future.
5. Focus on fiscal sustainability efforts that better position the City long-term.
6. Focus on projects and services that benefit the community as a whole.
7. Pursue economic development objectives and strategies to foster new public and private investment within Santa Clara, and to create employment opportunities.
8. Balance between compensation adjustments to retain and attract employees and funding for positions.
9. Use one-time unrestricted revenues (e.g., annual General Fund surplus) for one-time uses such as increasing reserves, funding capital or Information Technology projects, paying off debt, and/or paying off unfunded pension or other post-employment benefits liabilities.
10. Inform and communicate clearly and broadly to residents, businesses and employees regarding the City’s fiscal position and budget; schedule hearings to promote active participation in the City Council’s budget deliberations.
11. With limited exceptions, establish fees based on full cost recovery where individuals/businesses rather than the community at-large are benefitting from City services. This preserves limited unrestricted resources for providing services that benefit the community as a whole.
12. Focus on business process redesign in order to improve employee productivity and the quality, flexibility, and cost-effectiveness of service delivery (e.g., streamlining, simplifying, reorganizing functions, and reallocating resources).
13. Explore expanding existing revenue sources and/or adding new revenue sources to address targeted needs.
14. Engage employees to contribute their ideas and expertise to the budget development process and inform employees on the content of the budget and priorities for the upcoming year.
15. Use the General Plan as a primary long-term fiscal planning tool and link the ability to provide City services to development policy decisions
In addition to these Budget Principles, new CIP projects are also to be reviewed by the Planning Commission on a biennial basis for consistency with the 2010-2035 General Plan.
2010-2035 General Plan
On November 16, 2010, the City Council adopted the 2010-2035 General Plan and certified the associated Final Environmental Impact Report. There are seven Major Strategies that represent the overarching principles in the City’s General Plan. The Strategies provide the foundation for the Plan’s goals and policies, as well as implementing actions. Each Strategy listed below defines a distinct priority, such as economic vitality or sustainability.
1. Enhance the City’s High Quality of Life
2. Preserve and Cultivate Neighborhoods
3. Promote Sustainability
4. Enhance the City Identity
5. Support Focus Areas and Community Vitality
6. Maintain the City’s Fiscal Health and Quality of Services
7. Maximize Health and Safety Benefits
The General Plan is a “Progressive General Plan” which provides a multi-horizon sequence for development as a mechanism to facilitate responsible growth. The City’s General Plan policies are designed to guide this development. Collectively, these policies comprise the Plan’s implementation program. Policies provide direction for public improvements, define appropriate land uses, identify standards for new development and detail measures to protect the City’s environmental quality.
Implementation of the General Plan involves the City Council, the Planning Commission, other City review bodies, City Staff, and the community. Community Development Department staff has primary responsibility for implementing the Plan.
Considerations
New Projects for Consistency Review
For this report, staff is focusing on projects that are new to the CIP budget, and have not yet been analyzed for General Plan conformance. There are 29 newly created projects that are fully or partially funded in the Biennial FY 2026/27 and FY 2027/28 CIP (Attachment 1). Some of these projects include
• Storm Drain Master Plan Update;
• Fairway Glen, Lickmill, and Tri-Level Underpass Storm Drain Pump Station Rehabilitations;
• Median Islands Water Conservation and Drought Tolerant Landscape Improvements;
• Installation of new and additional bicycle parking at end of trip priority locations identified in the Bicycle Masterplan;
• Central Park Library Carpet Replacement and Interior Repaint;
• Replacement of the City’s VOIP Phone System for Aging Mitel Connect; and
• 13 projects for the Electric Utility, Silicon Valley Power, including
o Hydro Penstock Repairs (penstocks are pressure pipes that convey water from the reservoirs to the hydroturbines);
o Expansion of SVP’s 230 kV facilities at NRS and the SVP Switching Station (SSS) to meet the California Independent System Operator's (CAISO);
o Replacement of poles along Central Expressway to enable double-circuited 60 kV lines above and 12 kV lines below; and Modernization and improvement of distribution reliability for feeders exiting Uranium Substation.
The newly added projects are consistent with the General Plan’s intent to promote high quality of life enjoyed in the City; encourage the preservation and enhancement of existing neighborhoods; maintain the quality of City services and amenities; and support the following Major Strategies:
• Major Strategy No. 1, Enhancing the City’s High Quality of Life;
• Major Strategy No. 3, Promote Sustainability; and
• Major Strategy No. 6, Maintain the City’s Fiscal Health and Quality Services.
In addition, the projects also align to various goals and strategies that include, but are not limited to, Sustainability and Environmental Protection, Mobility and Transportation, and Quality of Services. Some of the major projects are highlighted below and are organized by the goals and policies category of the General Plan.
Sustainability and Environmental Protection
The CIP budget includes a line item for Median Islands Water Conservation and Drought Tolerant Landscape Improvements that include converting existing turf areas to water-efficient and drought-tolerant landscaping to save resources and support biodiversity and natural pollinators:
• 5.10.1‐P11 Require use of native plants and wildlife‐compatible non‐native plants, when feasible, for landscaping on City property.
Mobility and Transportation
The CIP budget includes a line item for new and additional bicycle parking at end of trip priority locations. These projects are consistent with the General Plan Mobility and Transportation policies, including:
• 5.8.1‐G3 Transportation networks that promote a reduction in the use of personal vehicles and vehicle miles traveled.
• 5.8.4 P2: Provide a system of pedestrian and bicycle friendly facilities that supports the use of
alternative travel modes and connects to activity centers as well as residential, office and mixed use developments.
• 5.8.4‐P10 Encourage safe, secure and convenient bicycle parking and end‐of‐trip, or bicycle “stop” facilities, such as showers or bicycle repair near destinations for all users, including commuters, residents, shoppers, students and other bicycle travelers.
Quality of Services
The CIP consists of projects that help to maintain the City’s Quality of Services, which includes
maintaining the Central Park Library with carpet replacement and interior repaint, replacement of the City’s VOIP phone system, Fairway Glen Storm Drain Pump Station rehabilitation, expansion of SVP’s NRS and the SVP Switching Station, replacement of poles along Central Expressway, and modernization and improvement of feeders at the existing Uranium Substation. These projects are consistent with the following General Plan policies:
• 5.3.1 P17 Promote economic vitality by maintaining the City’s level of service for public facilities and infrastructure, including affordable utilities and high-quality telecommunications.
• 5.10.3‐G3 Adequate energy service to residents, businesses, and municipal operations.
• 5.10.3 P10 Maintain the City’s level of service for high quality utilities and telecommunications
Each of the projects in the proposed CIP was similarly compared to relevant General Plan policies. Based on this analysis, staff has concluded that the Proposed FY 2026/27 and FY 2027/28 Biennial Capital Improvement Program Budget is consistent with the 2010-2035 General Plan.
Proposed Planning Commission Actions
The proposed Biennial Capital Budget is presented to the Planning Commission for consideration and action. The following specific actions are required:
1. Find that the projects listed in the proposed FY 2026/27 and FY 2027/28 Biennial Capital Improvement Program Budget are consistent with the Santa Clara 2010-2035 General Plan major strategies and goals and policies; and
2. Find that the proposed FY 2026/27 and FY 2027/28 Biennial Capital Improvement Program Budget takes into consideration the FY 2026/27 Budget Principles.
These findings are included in the proposed resolution (Attachment 2).
ENVIRONMENTAL REVIEW
Environmental review determinations are provided as part of the table entitled, Proposed FY 2026/27 and FY 2027/28 Biennial Capital Improvement Program Budget CEQA Determinations, which is included as Attachment 1.
FISCAL IMPACT
There is no fiscal impact to the City for the determination of General Plan Consistency for CIP projects.
COORDINATION
This report has been coordinated with the City Attorney’s Office.
PUBLIC CONTACT
Public contact was made by posting the Planning Commission agenda on the City’s official-notice bulletin board outside City Hall Council Chambers. A complete agenda packet is available on the City’s website and in the City Clerk’s Office at least 72 hours prior to a Regular Meeting and 24 hours prior to a Special Meeting. A hard copy of any agenda report may be requested by contacting the City Clerk’s Office at (408) 615-2220, email clerk@santaclaraca.gov or at the public information desk at any City of Santa Clara public library.
RECOMMENDATION
Recommendation
1. Adopt a resolution recommending that the City Council making findings on the conformity of the Proposed FY 2026/27 and FY 2027/28 Biennial Capital Improvement Program Budget with the 2010-2035 General Plan.
Staff
Prepared by: Lesley Xavier, Planning Manager
Reviewed by: Alexander Abbe, Assistant City Attorney
Approved by: Afshan Hamid, Director, Community Development Department
ATTACHMENTS
1. CIP Projects and CEQA Determinations
2. PC Resolution FY 2026/27 and FY 2027/28 CIP Budget General Plan Conformity Findings
3. Proposed FY 2026/27 and FY 2027/28 Biennial Capital Improvement Program Budget