REPORT TO PLANNING COMMISSION
SUBJECT
Title
Informational Update on Administrative Implementation of State Law on Replacement Housing Unit Determinations and Related Tenant Protections
Report
SUMMARY
This informational report provides an overview of staff’s proposed implementation approach for replacement housing unit determinations and related tenant protections required under state law. Rather than adopting a local ordinance at this time, staff have developed a supplemental application packet, modeled after approaches used by other California cities and tailored for use with City of Santa Clara planning applications.
On August 26, 2026, the Planning Commission considered a public hearing item regarding a proposed replacement housing unit ordinance. Following Commission discussion, the Commission continued the item to November 18, 2026, and requested an expanded comparison chart comparing state-law requirements with the City’s proposed implementation approach. Based on the discussion and additional staff review, staff are proceeding with an administrative implementation approach using supplemental application materials rather than a local ordinance.
The Supplemental Application Packet implements Housing Plan Action 13 of the 2023-2031 Housing Element by enforcing state law provisions and translating broad legislative intent into clear project requirements.
The supplemental application packet is intended to assist applicants, property owners, occupants, and staff in identifying when state replacement housing requirements apply; documenting the existing and prior residential unit inventory on a project site; determining whether any units are protected units; and identifying applicable notice, relocation, right to remain, right of first refusal, right to return, and replacement unit obligations. Table 1 summarizes applicable state law requirements and how the proposed supplemental application materials address those requirements.
This item is provided for informational purposes only, and no Planning Commission action is requested.
BACKGROUND
The Density Bonus Law (Government Code Sections 65915 - 65918), Housing Element Law (Government Code Sections 65580 - 65589.11), and Senate Bill (SB) 330-the Housing Crisis Act of 2019 (Government Code Sections 66300 - 663001), establish requirements intended to prevent the loss of existing residential capacity and protected housing units when redevelopment occurs.
These state laws establish replacement housing requirements for covered housing development projects and impose additional requirements on covered housing and non-housing development projects involving protected units, subject to statutory exceptions. Protected units include units that are or were deed-restricted for lower-income households, subject to rent or price control, rented by lower-income households, or withdrawn from the rental market under the Ellis Act within the applicable lookback period.
Implementation of 2023-2031 Housing Element Housing Plan Action 13
The City’s certified 2023-2031 Housing Element includes actions that support anti-displacement objectives through measures designed to protect, preserve, and produce affordable housing. Housing Plan Action 13: Residential Displacement includes objectives related to no net loss of income-restricted residential units, replacement of existing affordable units, tenant noticing, tenant rights information, and evaluation of relocation benefits. As stated earlier, the Supplemental Application Packet implements Housing Plan Action 13 of the 2023-2031 Housing Element by enforcing state law provisions and translating broad legislative intent into clear project requirements.
August 26, 2026, Planning Commission Meeting Summary
Staff evaluated a local ordinance approach to consolidate and codify state replacement housing requirements and related tenant protections. At the August 26, 2026 Planning Commission meeting, Commissioners discussed the proposed ordinance approach and requested additional information regarding the scope of state-law requirements and the extent to which the City’s proposal would impose any requirements beyond state law.
Commissioner comments and questions included concerns that the proposal could affect private property rights, impose restrictions on rental income, discourage rental housing inventory, and affect small property owners. Commissioners also asked how lower-income households would be defined, what alternatives were available, which staff initiated the proposal, what Housing Plan Action 13 required, and what critical deadlines or compliance pressures applied.
Staff explained that the replacement housing and tenant protection framework originates in state law, that the City is required to comply with applicable state law regardless of whether a local ordinance is adopted, and that the City has discretion in how to administer and document compliance. Staff also noted that the requirements generally apply when covered housing units are demolished or converted and replacement obligations are triggered, and that the proposed local approach was intended to implement state-law requirements and Housing Element commitments.
The Commission requested that staff return with a side-by-side chart comparing state-law requirements with the City’s proposed implementation approach. Following public comments, the Commission continued the item to November 18, 2026.
2026 City of Santa Clara Survey on Santa Clara Housing Policy
In addition to the 2025 Countywide Survey on Displacement, staff also conducted a supplemental community survey to help identify community priorities related to housing, tenant protections, and possible future policy options.
The survey was first introduced in person at the Art & Wine Festival on Sept. 19-20, 2026, and remained available online through Oct. 20, 2026, for a total of 31 days. To reach a broad audience, the survey was (1) promoted through the City’s social media channels, including Facebook, Instagram and Nextdoor; (2) featured in the October 2026 City Hall News; (3) distributed twice via email to the Citywide distribution list of approximately 53,000 subscribers; and (4) posted as a news item on the City’s website. In total, 1,196 responses were collected from community members.
Key Takeaways from the Housing Survey:
• Housing affordability was the top concern across respondent groups, with renters facing the greatest cost burden.
o A majority of respondents (51.9%) described housing in Santa Clara as somewhat or very unaffordable. Among respondents who reported housing-cost burden, 64.4% spent more than 30% of household income on housing; that figure rose to 84.4% for renters.
• Replacement housing received strong support among survey respondents.
o Of those responding, 81.9% said replacing homes removed through redevelopment is important. The leading preference was to prioritize replacement with affordable or lower-cost units (31.9%), followed by requiring at least the same number of units removed (26.5%).
• Preventing displacement and preserving affordability were identified as key policy priorities.
• Respondents supported a balanced redevelopment approach that protects tenants while allowing property improvement and redevelopment.
• Tenant protections should center on affordability, return rights, relocation, and clear procedures.
• Respondents favored clear, administrable rules that provide certainty to tenants, property owners, and developers.
• Respondents also favored project-specific flexibility where site conditions or feasibility warrant it, while maintaining core anti-displacement protections.
Finally, respondents expressed concern about confusing processes, excessive rules or delays, and redevelopment impacts on parking, traffic, infrastructure, retail, open space, and neighborhood character.
Overall, respondents supported policies that reduce the loss of existing housing, preserve lower-cost homes, and protect tenants from displacement. Results also indicate support among respondents for housing growth when it is accompanied by affordability, predictable rules, and investments that address local impacts. Respondents favored a balanced approach that enables property improvements and redevelopment while incorporating clear replacement requirements, affordability provisions, relocation assistance, and opportunities for eligible tenants to return to redeveloped housing.
Attachment #1 provides a detailed summary of community feedback received in response to the housing survey.
DISCUSSION
In response to the Commission’s feedback, staff have developed a supplemental application packet including a Replacement Housing Unit Determination Form, to be submitted with the applicable development application when a proposed project includes demolition of one or more existing housing units, or when residential units existed on the project site within the prior five years.
The supplemental application materials are modeled after approaches used by other California cities and are intended to provide a clear administrative process for determining whether state replacement housing requirements apply. The materials request project information, site and unit inventory information, occupancy and vacancy history, income documentation when applicable, and applicant certifications. The City would use the submitted materials and supporting documentation to determine the number of existing units, whether any existing or previously demolished units are protected units, and the number and affordability level of replacement units required under state law.
The supplemental packet is also intended to improve early communication with applicants and occupants by identifying notices and tenant protections required by State Law. These include the right to remain until six months before the start of construction activities, written notice at least six months before the required move-out date, relocation benefits for qualifying lower-income occupants of protected units, a right of first refusal to a comparable affordable unit in the completed development where applicable, and the right to return at the prior rental rate if demolition does not proceed and units are returned to the rental market.
The proposed approach does not create new local standards beyond state law. Instead, it provides a consistent documentation and review process to support implementation of existing state-law requirements through the City’s development review process. Staff will continue to evaluate whether additional local regulations or future amendments are warranted based on implementation experience, changes in state law, and direction from the City Council.
In response to the Commission’s request, Table 1, below, summarizes applicable state law requirements and how the proposed supplemental application materials address those requirements.
Table 1: State Law Requirements & Proposed Supplemental Application Materials
|
State-Law Requirement |
How Proposed Supplemental Materials Will Address Requirement |
|
No net loss of residential units |
Requires applicants to identify existing residential units, units demolished within the applicable lookback period, and proposed replacement units so staff can verify that the project provides at least as many units as required by state law. |
|
Replacement of protected units |
Requires applicants to identify whether any existing or demolished units are protected units, including deed-restricted lower-income units, units subject to rent or price control, units rented by lower-income households, and units withdrawn under the Ellis Act within applicable lookback periods. |
|
Occupant information and lower-income household determination |
Requests occupancy and household income information needed to determine whether replacement and tenant protection requirements apply, subject to applicable privacy and documentation protocols. |
|
Right to remain |
Identifies whether occupants of protected units have a right to remain until six months before the start of construction activities and documents written notice at least six months before the required move-out date, consistent with state law. |
|
Relocation benefits |
Requires applicants to identify whether relocation benefits are required for lower-income occupants of protected units and to provide documentation of compliance before applicable project milestones. |
|
Right of first refusal and right to return |
Requires applicants to identify whether qualifying lower-income occupants of protected units must be offered the opportunity to occupy a comparable affordable unit in the new development or required replacement housing, consistent with state law. Also documents the right of existing occupants to return at their prior rental rate if demolition does not proceed and the property is returned to the rental market. |
|
Affordability and replacement unit characteristics |
Requires information on the number, affordability level, bedroom count, and completion timing of replacement units and the required duration of affordability restrictions to support staff review for consistency with state requirements. |
|
Applicability to housing and non-housing development projects |
Requires applicants to identify the project type and whether the project includes demolition or conversion of existing residential units, allowing staff to determine the applicable state-law framework, including requirements for replacement housing associated with non-housing projects to be developed within the City before or concurrently with the project, subject to statutory exceptions. |
|
Administrative review and documentation |
Creates a standardized submittal and review process to document compliance without adopting a new local ordinance. |
Proposed Planning Commission Actions
The Commission is asked to note and file this informational report. No Planning Commission action is requested. Staff will administer existing State Law through the supplemental application materials.
ENVIRONMENTAL REVIEW
This informational report is not a project under the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines section 15378(b)(5) because receiving the report and administering existing state-law requirements through supplemental application materials are administrative activities that will not result in a direct or reasonably foreseeable indirect physical change in the environment.
FISCAL IMPACT
There is no fiscal impact to the City associated with receiving this informational report other than administrative staff time. Implementation of the supplemental application materials is expected to be administered using existing staff resources. If future implementation requires additional resources, staff will identify those needs through the budget process or return to the Planning Commission and/or City Council, as applicable.
COORDINATION
This report was coordinated with the City Manager’s Office and 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
Note and file the informational report on the Administrative Implementation of State Law on Replacement Housing Unit Determinations and Related Tenant Protections, including the summary of the August 26, 2026, Planning Commission meeting. No Planning Commission action is requested.
Staff
Prepared by: Lakshmi Rajagopalan, Assistant Director, Community Development Department
Reviewed by: Alexander Abbe, Assistant City Attorney
Reviewed by: Afshan Hamid, Director, Community Development Department
Approved by: Jovan Grogan, City Manager
ATTACHMENTS
1. City of Santa Clara Housing Survey - Summary Report