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                                                                                             Annual Report
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San José
              Table                     of Contents

              Intro                              2

              Message from the Mayor             3

              Elected Officials                  4

              Message from the City Manager      5

              San José Builds                    6

              San José Innovates                 7

              San José Streamlines               8

              San José Soars                     9

              San José Plays                     10

              San José Rocks                     11

              San José Prepares                  12

              San José Conserves                 13

              San José Cares                     14

              Financials                         16

              Council Appointees & Sr. Staff     20

    San José is...                                                                 Mayor’s                                      Message
    • The Tenth Largest City In The Country                                        As I look back on my eight years as Mayor of San           foundation for long-term prosperity with
    • The Safest Big City In The Nation                                            José, I’m very proud of what we have accomplished          comprehensive plans for our industrial areas, more
                                                                                   by working together with our community to make             affordable housing, partnerships with our schools,
    • The World’s Top Competitive Knowledge Economy                                this city one of one of our nation’s best.                 regional collaboration for better transportation,
    • Venture Capitalists’ #1 Investment Locale                                                                                               and finally the start of construction of long awaited
    • The 2nd Most Undiscovered Tourist Destination                                Our residents live in safe and clean neighborhoods,        improvements at our airport.
                                                                                   and with the active engagement and leadership
    • One of the Top Twenty Five ‘Brainiest’ Cities in the Country                 from residents, we’ve made substantial progress to         It is testimony to the creativity, skill and dedication of
    • Ranked “Most Inventive Town” with National Leadership in Number of Patents   accomplish their highest priorities to build strong        all our employees and the support we have from our
                                                                                   neighborhoods. With impressive support from                community that we have achieved so much, even
    • One of the Top 5 Cities for Foreign-Born Residents
                                                                                   voters, we continue to make significant investments        with the difficult budget choices we’ve had to make,
    • One of the Greenest Cities in the U.S.                                       in long-overdue improvements to our neighborhood           year after year, during the severe Silicon Valley
                                                                                   parks, libraries, and fire stations to catch up with the   recession of the past six years. We have focused on

    San José has...
                                                                                   growth of our community and meet the changing              good planning, fiscal prudence, and innovation to
                                                                                   needs of our residents.                                    meet these challenges, and we continue to work with
                                                                                                                                              our entire community to achieve the goals most
                                                                                   We’ve achieved real progress to become a more              important for our residents and businesses.
                                                                                   responsive, customer-oriented organization, using
                                                                                   technology, our new beautiful City Hall, and a clear       This is my last opportunity as Mayor of San José to
    • Productivity twice the National Average                                      commitment to quality service to help our residents        discuss our achievements and progress over the past
    • More College Grads per 100 Residents than any other Major U.S. City.         and businesses get what they need from us faster.          year. It has been a deep honor to have had the
                                                                                   We have become better partners with our business           opportunity to serve the people of San José, and it
    • More Home Owners than any other Large City in the Country                    community to provide them with the support, the            has been my great privilege to work with such an
    • Largest Concentration of Tech Companies and Talent in America                strategy, and the services they need to grow and           outstanding corps of dedicated public employees and
                                                                                   create opportunities for our residents.                    engaged citizens. Although we have accomplished
    • Most Diversified Technology Economy
                                                                                                                                              much together, there is much more we can do so that
    • One of the Most Advanced Entrepreneurial Infrastructures in the Country      Our downtown has become a vibrant regional center          San José can realize its full promise and potential.
    • Top Rate of Recycling Per Resident in the U.S.                               for a wide range of culture and entertainment, and         I wish everyone the best, and look forward to
                                                                                   it is also growing as an attractive neighborhood for       sustained progress in the future.
                                                                                   thousands of new residents who appreciate urban
                                                                                   living. We have taken essential steps to secure the        Ron Gonzales
    Welcome to the City of San José,                                                                                                          Mayor

           the Capital of Silicon Valley

2                                                                                                                                                                                                          3
                        San José                 City Council
                                                                                        Manager’s                                                         Message
                                                                                        The past fiscal year was a year of transitions for San   national and international profile in both business
    San José City Elected Officials                                                     José. On the one hand we can now say with some           and the arts—more companies are utilizing our
                                                                                        certainty that we have now emerged from one the          innovative business incubator spaces while San José
    The City of San José would like to welcome                                          most severe economic downturns we’ve experienced         has become the creative hub for several high profile
    newly elected members of our City Council                                           in decades to a more stable financial condition. As      national and international events.
                                                                                        evidence of the improved economic conditions,
    Chuck Reed       Mayor                        District 1         District 6         overall General Fund Revenues grew by over $80           Readers of this Annual Report will find evidence of
    Pete Constant    District 1                   Linda J. LeZotte   Ken Yeager         million from the prior year and all three credit         San José’s continuing commitment to improving our
    Sam Liccardo     District 3                                                         rating agencies have confirmed our high bond             City. Significant changes got underway at the
                                                                                        ratings and sound financial condition. Despite the       Norman Y. Mineta San José International Airport
    We would like to extend our thanks and                                              improving fiscal outlook, however, projections for       this year with work commencing on the new
    appreciation to outgoing members of the                                             the future show that San José’s existing revenue base    Central Terminal to provide more passenger
    City Council                                                                        will not support our programs and services at their      amenities along with increased space for airlines,
                                                                                        current level of growth, nor is their money to           baggage handling, and new security requirements.
    Former Mayor     Ron Gonzales                 District 2         District 7         address either future operating costs for new            We’ve exceeded our goals for affordable housing and
    Linda LeZotte    District 1                   Forrest Williams   Madison Nguyen     facilities that are being built or efforts to restore    become a leader in the region. New and improved
    Cindy Chavez     District 3                                                         some of the core service reductions imposed during       park and library facilities were opened, enhancing
    Ken Yeager       District 6                                                         the past five years.                                     our neighborhoods and continuing the effort
                                                                                                                                                 launched by the voters and the San José City
    for their years of public service.                                                  Despite the ongoing fiscal challenges facing San         Council early in this decade with the passage of
                                                                                        José, there is much of which to be proud. Working        bond measures to improve public facilities.
                                                                                        through the dot-com bust was a wake up call. We
                                                  District 3         District 8         have risen to the challenge by evaluating how we         Our residents and businesses have long partnered
                                                  Cindy Chavez       David D. Cortese   provide services for our residents, engaging our         with the City to overcome challenges. Together, in
                                                                                        increasingly diverse local community in planning for     the face of five declining budget years, we have
                                                                                        the future, making sure we preserve and attract jobs     maintained an astonishing breadth of services to our
                                                                                        to San Jose by supporting our existing businesses        community. I am proud of the work we have done
                                                                                        and encouraging new businesses to locate here.           and of the commitments made by our City Council
                                                                                                                                                 and City staff to keep San José a wonderful place to
                                                                                        We’ve focused our recovery not only on our               live, work and create.
                                                  District 4         District 9         economic conditions but on our services as well.
                                                  Chuck Reed         Judy Chirco                                                                 Les White
                                                                                        We’ve reengineered how we deliver some services to       City Manager
                                                                                        be more efficient, while streamlining our permitting
                                                                                        processes and revamping our customer service
                                                                                        systems to be more user-friendly for both residents
                                                                                        and business owners. We’re raising San José’s

                                                  District 5         District 10
                                                  Nora Campos        Nancy Pyle

4                                                                                                                                                                                                       5
SNAPSHOT:                    According to the New York Times, venture capitalists      Business Tax Incentives Program in 2006 which             San José has the largest concentration of business      location in Downtown San José for information,             SNAPSHOT:
                             still find Silicon Valley the best climate in the         allows businesses with 35 or fewer employees to           incubators in the United States and the City and its    connections and education. With over 2,300                 Climate favorable
Nanosolar will open                                                                                                                              Redevelopment Agency help spawn the new technol-
                             country for business innovation and development.          receive a 50 percent reduction on Construction                                                                    members and 20 to 30 events monthly, the Forum,            for change
one of the world’s                                                                                                                               ogy businesses of tomorrow by supporting some of
                             The City of San José, the Capital of Silicon Valley, is   Excise Taxes for new construction or tenant                                                                       one of the nation’s premier software and Internet
largest solar cell                                                                                                                               the best-known technology incubators in the country.
                             committed to contributing to that climate. The City       improvements.                                                                                                     organizations, features business seminars, one-on-         • Job growth grew by
manufacturing facilities
                             continues to strengthen its business development                                                                    The Environmental Business Cluster (EBC) is the         one advisory meetings, quarterly showcase events,            9,100 jobs
in South San José in                                                                   The Entrepreneur Center (eCenter), located in
                             with incentives, innovation and workforce                                                                           first incubator of its kind in the United States.       and self-service labs. The SDF has 2,000 active
the Spring 2007. “It’s                                                                 Downtown San José, provides entrepreneurs with a
                             development. The result is more growth, more                                                                        Companies use the center to develop clean and           members, average of over 1,000 attendees per month         • Jobless rate dropped
clear San José knows                                                                   full range of business services, including finance
                             industry and more excitement in San José.                                                                           renewable energy products, as well, as other            and distribution of over 4,000 issues of the                 to 4.5%
how to deal with the                                                                   programs, technical assistance, management
                                                                                                                                                 environmental products and services. The latest         SDForum bi-monthly newsletter.
Ciscos and eBays —           The City of San José Enterprise Zone was renewed          training, assistance with procurement programs,
they understand the                                                                                                                              initiative administered by the City’s Redevelopment                                                                • Hotel occupancy up
                             and reconfigured in 2006. Covering ten square             technology training, and international trade                                                                      San José BioCenter (SJBC), the first of its kind in          17.8%
issues, the logistics, the   miles encompassing Downtown San José, the                 counseling. The eCenter is a unique partnership           agency and Transportation department is the             California, is a state-of-the-art facility equipped with
transportation needs,”       Julian-Stockton and the Monterey corridors south of       between the U.S. Small Business Administration,           Electronic Transportation Development Center            wet laboratory and office space that provides world
said Nanosolar Chief                                                                                                                             (ETDC). The ETDC, now in the planning and                                                                          • Venture Capital
                             Downtown, the Zone covers 5900 businesses that            Cisco Systems, the City of San José and several                                                                   class business and facility services to high potential       investment up 9.8%
Executive Martin             employ over 50,000 people. Incentives for                 community business organizations.                         development stage, will be an R&D facility where        life science companies. SJBC members have access
Roscheisen. “And we                                                                                                                              Silicon Valley companies will collaborate on the                                                                     over last year
                             Enterprise Zone companies include tax credits and                                                                                                                           to an extensive range of products, services and
can get a permit within      benefits for each qualified employee hired, sales tax     The City of San José has the most educated work           design, development, prototype fabrication, and         equipment that enables them to grow and scale
a matter of days. Other                                                                                                                          commercialization of clean-energy hybrid vehicles                                                                  • Productivity rises to
                             credits on qualified machinery and machinery parts,       force in the nation and we strive to provide a skilled                                                            successful businesses. This year the City invested
regions would take                                                                                                                               that meet homeland security needs and reduce our                                                                     twice the national
                             and preference points on state contracts. Bottom          work force for our business and industry as well.                                                                 over $8.7 million dollars in tenant improvements
several months.”                                                                                                                                 dependence on foreign oil.                                                                                           average
                             line - more jobs to San José.                             The work2 future Program is successfully meeting                                                                  and a specialized-equipment acquisition program.
                                                                                       the workforce requirements of local businesses and                                                                Twenty one companies, one of which was named
                                                                                                                                                 The Software Business Cluster (SBC) was
                             Our Small Business Ambassador Program assisted            the employment needs of residents. The program                                                                    one of 2006’s hottest emerging technologies by the         The City of San José’s
                                                                                                                                                 recognized by the National Business Incubator
                             199 businesses this year. The program helps small         served over 100,000 job seekers in past year. Their                                                               Silicon Valley/San José Business Journal, are located      business climate has
                                                                                                                                                 Association as “Incubator of the Year.” Of the 95
                             businesses with new locations, relocations and            minority and women-owned small businesses                                                                         at the SJBC in a variety of bioconveyance industry         definitely taken a turn
                                                                                                                                                 software companies located in Downtown San José,
                             expansions. The goal is to simplify and expedite the      outreach program connects business owners with                                                                    sectors.                                                   for the better. As a
                                                                                                                                                 more than two-thirds developed in the SBC. It
                             permit process while providing a personal ambassador      human resource assistance, training and technical                                                                                                                            city, we’ve diversified
                                                                                                                                                 attracts up to 25 early-stage software and mobile
                             as a single point of contact for each project. That       assistance, access to capital and other information.                                                              U.S. Market Access Center (US MAC): successful             the way we do
                                                                                                                                                 technology companies at a time. The motto of the
                             includes research of potential business sites,            This year the program celebrated the grand opening                                                                international firms specializing in I.T., life sciences    business to serve a
                                                                                                                                                 Software Business Cluster is “Innovate, Incubate,
                             customized checklists, development fees estimates,        of its latest One-Stop Center, bringing, under one                                                                and solar/renewal energy join the US MAC to                diversified world.
                                                                                                                                                 Accelerate.” The SBC provides early-stage software
                             tailored inspection teams, energy and water saving        roof, a multitude of free/low-cost resources for job                                                              understand U.S. marketing and strategy. The center         Through incentives,
                                                                                                                                                 companies with an environment loaded with men-
                             strategies and reduced taxes.                             seekers in San José and south Santa Clara County.                                                                 assists companies by providing executive suites            innovation and talent
                                                                                                                                                 toring, funding and networking opportunities. It        facilitating business relationships with companies in      development, San José
                             In the past year, six manufacturing, research and         San Jose is the home of business innovation. Our          expedites their growth by assisting with business       the San José/ Silicon Valley region. In 2006 the           is building the future.
                             development companies utilized the new Industrial         Software, Environmental, International and                plan refinement, the development of marketing           National Business Incubator Association (NBIA)
                             Tool Installation Program. The program allows             Bioscience Incubators, a $20 million investment,          plans, investor and customer presentations, office      designated U.S. MAC a Soft Landings International
                             them to remain competitive by shortening tool             have launched 240 companies, generating 4,000             space, internet access and website and email hosting.   Incubator, one of only six selected in the world.
                             installation-to-production timelines.                     jobs and over $15 million in sales tax revenues
                                                                                       alone. Companies have raised $550 million in              The Software Development Forum provides
                             Thirty six businesses took advantage of our Small         equity, definitely a positive return on our investment.   software and Internet professionals with a one-stop

 6                                                                                                                                                                                                                                                                                            7
SNAPSHOT:                  In 2006, the City of San José made great strides in      Now there’s one payment system for water, trash          2006 saw the launch of the City’s large-scale,            properties located in communities surrounding the           SNAPSHOT:
                           improving all forms of customer service. We              or recycling.                                            campaign to make major improvements to the                Airport. In 2006, the program received approval and
By consolidating some                                                                                                                                                                                                                                              The Norman Y. Mineta
                           streamlined our most vital functions. The resulting                                                               Norman Y. Mineta San José International Airport.          guidelines from the State Historical Preservation
of the City’s operations                                                            Document management is a crucial, part of any                                                                                                                                  San José International
                           changes have led to faster, leaner system, focused on                                                             That campaign is already showing positive results.        Office for treatment of properties with historical
functions into our                                                                  government agency. The Electronic Document                                                                                                                                     Airport is named for
                           convenience for our residents and business owners,                                                                                                                          significance and work on the 208 properties
Central Service Yard                                                                Management System (EDMS) pilot program                   We began construction on the Airport’s $1.5 billion                                                                   one of the City San
                           fair fee structures and the most cost-efficient use of                                                                                                                      identified is expected to be completed by Spring
we’ll be able to close                                                              currently being custom-fitted for the Clerk’s Office,    Terminal Area Improvement Program (TAIP).                                                                             José’s favorite native
                           staff time. The response from the public has been a                                                                                                                         2007. Additional improvements are available to
the City’s Main                                                                     is the solution for managing the vast collection of      When completed, the Airport will have the latest                                                                      sons, Norman Yoshio
                           resounding ‘thank you.’                                                                                                                                                     qualified homeowners through low-interest loans
Operations Yard. This                                                               Council, Boards and Commission paperwork.                technology for improved passenger security                                                                            Mineta. Norm Mineta,
                                                                                                                                                                                                       and grants to pay for new roofs, exterior paint and
will make way for the      We’ve incorporated Process Streamlining to evaluate      Once in place, it will streamline contract tracking,     checkpoints and ticket facilities, more customer                                                                      who is of Japanese
                                                                                                                                                                                                       new landscaping. The Federal Aviation
development and            all aspects of our service delivery. Our goal is to      legislative indexing and the Council agenda              amenities, improved traffic flow and curbside                                                                         descent, went on from
                                                                                                                                                                                                       Administration (FAA) continues to support the
expansion of historic      reduce permit processing times, revise codes to          workflow process, making it easier to track and          service. A new rental car garage and service area, as                                                                 internment in a
                                                                                                                                                                                                       ACT Program with the award of a $6 million grant
Japantown. We’ve           more effectively serve citizens, training staff to       retrieve documents.                                      well as additional public parking across from the                                                                     Wyoming relocation
                                                                                                                                                                                                       in June 2006.
already conducted a        work more efficiently and ultimately improve overall                                                              terminals, will give travelers a level of convenience                                                                 camp during World War
series of community        development services for customers.                      As our EDMS capabilities increase, we will need fast     rarely seen at major airports.                            In 2006 we launched Airport Public Art Program,             II to become the first
meetings, gathering                                                                 and reliable storage. We are working to implement                                                                  a unified program of Art & Technology that will             American of Asian
input from residents       Every year we produce the Cost of Development            a new Storage Area Network (SAN) for the City’s          In January 07 our Airport lauches the Clear               showcase the innovation, diversity and change,              Pacific ancestry to
and other stakeholders     Survey for the region. This gives breakdown of fees      Network Operations Center. This network will             Registered Traveler Program, allowing enrolled            which define Silicon Valley. Working with planners,         serve as mayor of a
in Japantown, and          and taxes for each Silicon Valley city, a useful tool    provide storage and critical infrastructure necessary    passengers to pre-register expediting the security        policymakers and over 500 community members,                major American city,
we’ve begun the            that allows us to compare our fee structures to other    for business continuity in the aftermath of an           process. Mineta San José International Airport will       we are crafting a public art program unique to this         represent San Jose’s
process to move forward    cities. This year’s results show us at mid-range, a      emergency or system disruption. This will help           be the first airport on the west coast to introduce the   region. The artworks will be two or three-                  16th US Congressional
with the project.          bargain when you include the fact that we are the        protect our citizens and their valuable records.         program to customers.                                     dimensional and will include painting, sculpture,           District for 20 years,
                           10th largest city in the country and the number                                                                                                                             music, photography, film, textiles as well as digital       and the first Asian
                           one city for venture capital start-ups.                  Mapping our systems and facilities increases in          Our new Air Service Incentive Program waives                                                                          American to hold a post
                                                                                                                                                                                                       print, software art, robotics, interactive installations,
                                                                                    importance as our city grows and we plan for the         airline fees for up to 12 months for any carrier that                                                                 in the presidential
                                                                                                                                                                                                       multi-user installations. As with other arts and
                           City of San José’s new Design-Build Process in           future.. It has expanded to other, less obvious areas.   begins new non-stop service to a qualifying                                                                           cabinet. In 2006, he
                                                                                                                                                                                                       culture projects in the City of San José, it will
                           which both the design and construction of the            The need for a GIS Core Technology Infrastructure        destination. We also introduced a new carrier –                                                                       was awarded the
                                                                                                                                                                                                       explore the intersection of art, culture and
                           project are procured from a single entity, is saving     was evident. We established the basic infrastructure,    Hawaiian Airlines – with a daily flight to Honolulu                                                                   Presidential Medal of
                                                                                                                                                                                                       technology. The result will be a global gateway
                           money and reducing completion time on several            created the core network and now we’re moving it to      and a new flight by Mexicana Airlines to Mexico                                                                       Freedom. Like his
                                                                                                                                                                                                       distinguishing Norman Y. Mineta San Jose
                           large-scale projects such as the Airport renovation      each department, molding it to fit their needs. The      City. We also continued our outreach to the local                                                                     hometown,
                                                                                                                                                                                                       International Airport and the unique identity of
                           and the Central Yard Consolidation. San José             result is a shared system that includes not only the     business community by hosting workshops for those                                                                     Norman Y. Mineta is
                                                                                                                                                                                                       San José and Silicon Valley—in the past, present
                           residents and business owners will spend less time       City of San José but the County of Santa Clara and       interested in concession opportunities at the Airport                                                                 a trailblazer and a true
                                                                                                                                                                                                       and future.
                           ‘living with construction’ and more time enjoying        the Santa Clara Valley Water District as well.           (food, beverage and retail) through the Airport                                                                       representative of the
                           the results.                                                                                                      Concessions Disadvantaged Business Enterprise             These Airport improvements will offer updated facilities    spirit of San José.
                                                                                    Here in the City of San José, we’ve made major           (ACDBE) program.                                          and improved customer service while allowing us to
                           Streamlining our customer service processes was a        changes to ensure City government as customer-
                                                                                                                                                                                                       remain competitive with other airports. Our goal is
                           top priority. We created our Consolidated Utility        friendly as possible. Through streamlining, consoli-     Customer Service in San José is second only to
                                                                                                                                                                                                       to provide safe, secure, and efficient surface and air
                           Billing System in response to residents and business     dating and evaluating our technology we’re moving        customers’ safety and security. That means being a
                                                                                                                                                                                                       transportation systems that support San José’s
                           owners who stated clearly they wanted a system           towards the best type of customer service, service       good neighbor. Our Acoustical Treatment Program
                                                                                                                                                                                                       livability and economic vitality.
                           that’s both convenient access and easy to use.           that meets the needs of our customers.                   (ACT) continues to provide acoustical treatment to

 8                                                                                                                                                                                                                                                                                            9
SNAPSHOT:                 Despite our reputation as a technology center and         More than 50,000 people participated in the                event finished with a post-race party and a headliner     of food. All proceeds from the event go to fund arts
                          one of the ‘brainiest’ cities in the country, San José    Festival; attending performances, interacting with an      concert at the HP Pavilion at San José.                   education programs in schools and outreach efforts
In 2006 the City                                                                                                                                                                                         to the arts community.
                          plays —- hard.                                            artwork at dozens of venues, participating in the
created an Arts                                                                                                                                In between rocking, rolling and racing, we celebrated
                                                                                    educational programming, singing karaoke to
Stabilization Fund        This year it started in February as 140 of the world’s                                                               our incredibly diverse cultures. San José’s growing       We finished the year with the City of San José
                                                                                    ice-cream truck music, watching a movie on the
designed to help our      greatest cyclists sped through the City in the                                                                       appeal as an international city is due in great part to   Holiday Parade. Not just any holiday parade, but
                                                                                    walls of the Martin Luther King Jr. Main Library or
Arts organizations        inaugural Amgen Tour of California. The 8-day,                                                                       its incredibly varied population, each culture adding     the parade named by the International Festival and
                                                                                    by watching “Digital Kakejiku” illumination of San
establish sound           650-mile race hit town on the third leg of the                                                                       another element to create a truly unique city. With       Events Association as the best of its class in the
                                                                                    José’s City Hall Rotunda with amazement.
financial plans and       competition. The entire event brought crowds                                                                         one of the country’s largest populations of people of     world. Once again, San José took its place on the
structure to keep their   comparable to the Tour de France.                         The media coverage was remarkable, everything              Vietnamese descent, it was natural that we become         international stage. The Holiday Parade which has
doors open in any                                                                   from a full page story in the New York Times to features   home to the nation’s first Viet Heritage Gardens. It      also been named among USA Today’s Top 25 Parades
economy. The Arts         The Amgen Tour was followed by the 2nd Annual             in media outlets all over the world, heralding San         will be a place of tranquility where the community        in American is broadcasts nationally and brought
Stabilization Fund an     San José Grand Prix in July; three days, hundreds of      José as the epicenter of the art and technology            can share and cherish the culture and history of          thousands of spectators to Downtown San José.
example of our deter-     racecars roaring through Downtown, thousands of           convergence. ZeroOne San José returns in 2008,             Vietnam through art, architecture and horticulture.       This year, parade-goers were encouraged to bring
mination to build for     fans converging on area businesses. The 2006 San          it’ll be bigger, better and of course, spectacular.        The gardens will join the Mexican Heritage Plaza,         their laptops and take advantage of our free Wi Fi
the future and ensuring   José Grand Prix was watched live by more than a                                                                      the Chinese Cultural Garden in Overfelt Garden,           to hear event commentary and get information on
that the Arts will        million television viewers nationwide and broadcast       The San José Jazz Festival cooled down the August          and Japantown as a cultural celebration site, dedicated   parade routes.
remain a viable part of   to over a hundred countries making it the most            heat with an eclectic blend of the venerable jazz,         to all of us who make San Jose a truly global city.
that the City of San      watched U.S. event on the Champ Car World Series          Latin jazz, and blues legends jamming with the                                                                       From runners to racecars, artists to musicians, the
José’s future.            at the time. The greatest outcome of the race was it      hottest new artists on nine stages. This year’s            We also explored the cultural diversity and vitality of   City of San José rocks, rolls, runs and races. While
                          raised more than a million dollars for early cancer       attendance topped 55,000 and was described in the          San José with an array of festivals and events held in    we spend the majority of our time dedicated to
                          detection.                                                local media as world class event, best local festival      the downtown area including the Vietnamese Spring         providing the best services possible, we apply that
                                                                                    and a “…21st century block party with an old-time          Festival and Parade, the Cesar E. Chavez March and        same dedication to bringing exciting, unique,
                          Even as the Grand Prix grand stands came down,            neighborhood vibe.”                                        Festival. San José was also the location for one of the   world-class events to the City. San José is fast
                          ZeroOne San José: A Global Festival of Art on the                                                                    largest Immigration Marches in the nation, with           becoming not only the one of the country’s best
                          Edge, was kicking off for seven days of art and           We rocked right into October with the Rock ‘n’ Roll        over 100,000 marchers.                                    place to work but the best place to play as well.
                          interconnectivity. It was a first for San José and a      Marathon race series. The inaugural music half-
                          first for the world. Led by the San José Museum of        marathon, a 13.1-mile race through Downtown San            The year also included some of the most successful
                          Art, the festival had two goals; to connect a large       José, brought over 15,000 runners and walkers as           annual events in the country such as the Music in the
                          audience with ambitious, engaging art at the              well as more than 50,000 fans. The world-class com-        Park Summer Series, The International Mariachi
                          intersection of technology and creativity while           petition included elite athletes, a wheelchair invita-     Festival, The Juneteeth Celebration, The Festival of
                          raising the cultural profile of San José as a regional,   tional race, a finish-line festival and a two-day health   Independence to end homelessness and the Labor
                          national, and international leader at this                and fitness expo at the San José McEnery                   Day weekend Tapestry Arts Festival. The Tapestry
                          intersection. The City hosted 400 artists from            Convention Center. The race route was punctuated           Arts Festival brought in over 120, 000 attendees,
                          more than 35 countries around the world.                  with live bands and cheer squads at every mile. The        300 visual artists, four stages of live music and lots

10                                                                                                                                                                                                                                                              11
SNAPSHOT:                 Our public safety and emergency services are             credited with diverting 370 low-level offenders out       The City of San José is blessed not only with the          We’ve made major gains in protecting aquatic life by        SNAPSHOT:
                          building for the future this year by focusing on         of the juvenile system. The department also works         brilliant minds that created Silicon Valley but also       working with the Santa Clara Valley Water District
Starting as young as                                                                                                                                                                                                                                                Our beautiful creeks
                          communication, response time and education.              with KVVN Vietnamese Radio providing monthly              with the native beauty of the Santa Clara Valley.          and San José Conservation Corps to conduct creek
3rd grade the                                                                                                                                                                                                                                                       and award-winning
                          We began with a major investment in a system to          radio show on safety education, reaching 40,000           High tech towers of steel and glass are balanced by        cleanups throughout the year. In 2006 these
Challenges and                                                                                                                                                                                                                                                      trails are an integral
                          improve regional interoperability. The Emergency         listeners per broadcast.                                  tree-lined streets and historic homes, a place where       cleanups removed 11 tons of trash from the
Choices Program                                                                                                                                                                                                                                                     part of life in San José.
                          Communications System Project (ECOMM) a                                                                            you love to work and love to live. Our water quality       waterways but showed us where our existing waste
teaches violence                                                                   The Office of Emergency Services (OES), which                                                                                                                                    They’re also part of a
                          regional privately-owned microwave network, will                                                                   and quality of life all exceed state and national          management plans were working and where they
prevention/life skills                                                             provides the City and community with an effective                                                                                                                                strategic flood man-
                          provide reliable communications among 31 public                                                                    standards. We have dedicated ourselves to preserving       needed enhancement.
to students through                                                                response to natural, technological and terrorism-                                                                                                                                agement plan. Working
                          safety and emergency services agencies within                                                                      and conserving all of San Jose’s resources; natural,
middle school. The                                                                 related disasters, aggressively sought funding for                                                                   Our Recycled Water Program is funded by the City            with the Santa Clara
                          Santa Clara County. The new system is designed                                                                     community and financial.
ten-week curriculum                                                                more supplies, training and technology. As the threat                                                                of San José and surrounding jurisdictions. As of            Valley Water District
                          to reduce vulnerability of public safety
instructs students in                                                              of pandemic flu increased worldwide, the City of          This year, through our Recycling Program, which            2006, recycled water now represents about 10% of            and our most
                          communications systems to service interruptions
anger management,                                                                  San José began preparations. By storing vaccines,         includes commercial and curbside recycling as well         all water used outdoors in our eight-city water             challenging partner,
                          experienced by commercial telephone and cellular
peer pressure, drug and                                                            organizing supplies and establishing a                    as composting, we’ve managed to divert 64% of                                                                          Mother Nature, we’re
                          networks during major incidents.                                                                                                                                              pollution control plant service area. For the three
gang awareness. It also                                                            communication/response plan, OES is working to            waste away from the landfills. This far exceeds the                                                                    developing a 100-mile
                                                                                                                                                                                                        cities closest to the recycled lines, the water serves as
requires parents and      Serving San José’s rapidly growing population            significantly reduce the impact the disease can have      state mandate of 50% and is one of the highest rates                                                                   network of trails that
                                                                                                                                                                                                        an alternative to lavishing expensive potable water
students work together    required a complete reevaluation of how we respond       on the organization. This ensures that the City will      of large cities in the nation. This not only protects                                                                  provide both recreation
                                                                                                                                                                                                        on landscaping. For the cities further from the lines,
on personalized           and use our resource during emergencies. The City        continue to function and provide services to our          our resources but saves the City money in landfill                                                                     and flood management
                                                                                                                                                                                                        it frees up more of the valuable potable water for
homework                  needed a more effective way to dispatch first            residents during a pandemic flu outbreak.                 fees and charges. San José is proving that conservation                                                                making use of natural
                                                                                                                                                                                                        their use. Within the City, we use recycled water for       flows and natural
assignments, spreading    responders. Fire, Police and other public safety staff                                                             and cash flow can go hand in hand. City residents          everything from power plants to watering golf               beauty.
the message               met the challenge by updating the Computer Aided         OES has trained over 80% of City staff on the             and business owners are our partners in this effort.       courses to flushing the lavatories in City Hall,
throughout households.    Dispatch (CAD) system. The updated CAD system            emergency management protocols used by the                We’ve hosted over 50 neighborhood clean-up events
                                                                                                                                                                                                        practical use of a precious resource.
In 2005-2006 nearly       enables dispatchers to monitor multiple events at        federal and state governments. The training continued     this year, allowing residents to dispose of a variety of
6000 students             one time, streamlines request entries and improves       into the community with San José Prepared!, the           bulky goods at no extra charge. The end result is          On a larger scale, in a partnership with the Santa
participated in the       public safety staff ’s ability to access important       Community Emergency Response Team (CERT)                  fewer eyesores and less money spent cleaning up            Clara Valley Water District, we are developing a
program.                  historical data. This improvement has reduced            program that instructs volunteer community                illegal dumps.                                             master plan for water supplies through the year
                          emergency response times, resulting in the               members in disaster preparedness response, and                                                                       2030 that calls for greater water conservation,
                          apprehension of several violent suspects.                recovery skills. San José Prepared! training covers       This community-conscious involvement also is               expanded use of recycled water, and new approaches
                                                                                   everything from Neighborhood Organization to              demonstrated by the strides we’ve made in our              to infrastructure financing. By meticulously
                          The Police Department’s award-winning Gang               Search and Rescue in an effort to help empower            Stormwater Protection Programs. We’ve                      planning for future growth and expansion, we’ve
                          Prevention Program focuses on teaching students          residents to be more self-sufficient during a disaster.   restructured our process to begin at the beginning.        built in protection for creeks and trails as well as
                          how to handle conflicts and confrontations before        OES also sponsors San José R.A.C.E.S. (Radio              Our inspectors work together with developers at            guaranteed water supply and high water quality.
                          they actually meet them. Working together with                                                                     construction projects to ensure that best practices are    This protects the quality of our communities as well.
                                                                                   Amateurs in Civil Emergency Service) to provide
                          community-based organizations, neighborhoods and                                                                   used during and throughout the life of the project to
                                                                                   additional communication resources during crises.
                          schools we saw a 21% reduction in gang-related                                                                     prevent stormwater or over-watering runoff from            In the City of San José we include all of our
                          crime over the past year. The program reaches all age    While we can’t truly prepare for every aspect of a        polluting nearby streams. The City continues to            resources and all of our challenges in planning for the
                          groups. The Safe Alternatives and Violence               disaster, we can plan for communication, response         emphasize design and source control as the primary         future. Using this model, we’ve proved that conservation
                          Education Program (SAVE), which provides the             and recovery. The City of San José has made being         tactics on a project-by-project basis, preserving our      of natural resources, community resources and
                          classes for troubled youths and their parents, is        prepared a priority.                                      natural resources.                                         financial resources is not only practical but possible.

12                                                                                                                                                                                                                                                                                              13
SNAPSHOT:                  In the City of San José we balance our drive to serve     program for San José State faculty in June 2006. The    José Library system, local schools, and non-profit       walking dogs, socializing cats, working in the           SNAPSHOT:
                           our business interests with a dedication to nurturing     City Council approved the creation of a San José        organizations served more than 29,300 youngsters in      shelter’s laundry and kitchen, helping with various
The San José Teacher                                                                                                                                                                                                                                           Our Happy Hollow Park
                           our residents by offering services that encouraging       State University Pilot Homeownership Program            2005-06. This program was an integral part of why        administrative duties as well as organizing off-site
Homebuyer Program                                                                                                                                                                                                                                              and Zoo was voted
                           lifelong learning, make life enjoyable, and strengthen    (FHP) modeled after the City’s successful Teacher       the City of San José was identified as one of the        pet fairs and special events.
(THP) reached a                                                                                                                                                                                                                                                ‘Best Place to See
                           and sustain our communities and neighborhoods.            Homebuyer Program (THP), providing qualified            “Top 100 Communities for Young People” by                In 2006 our Office on Aging redoubled its efforts
milestone this year                                                                                                                                                                                                                                            Animals in the Bay
                                                                                     faculty members with interest free loans to help with   America’s Promise. This comprehensive program            to serve our senior residents. The Older Adult
when Myra Rountree,        With area housing prices among the highest in the                                                                                                                                                                                   Area’ by Bay Area
                                                                                     down payments on homes.                                 provides tutoring and homework assistance,               Resource Program (OARS) was restructured to
a fourth-grade teacher     nation we invested more into our award-winning                                                                                                                                                                                      Parent readers. That
                                                                                                                                             recreation and academic and culturally enriching         make it more accessible to seniors. The Senior
from the LUCHA             Affordable Housing Program to become one of the           Hurricane Katrina devastated the Gulf Coast in                                                                                                                            places it in the maga-
                                                                                                                                             programs to children during the critical after school    Employment Center was expanded into a full
Elementary School in       leading cities in California for affordable housing. In   2005, and San José continued to help families                                                                                                                             zine’s Hall of Fame
                                                                                                                                             hours. The most recent SJAS evaluation shows             service Information and Assistance Center. Client
the Alum Rock School       the 2006 “report card” from the Bay Area Council          recover in 2006. Of the 143 families and individuals                                                                                                                      after been voted ‘best’
                                                                                                                                             92% of parents rated the program as excellent, and       visitations have nearly tripled since the expansion of
District, moved into her   the City of San José received an A+ for producing         originally registered in Santa Clara County, 81                                                                                                                           for three years in a row
                                                                                                                                             78% of children increased their ability to read.         the center. A new Senior Information Telephone
first home aided by the    over 16,000 affordable housing units between 1999         households resettled permanently in San José. The
San José Teacher           and 2005. That’s more than two and one-half times         families have continued to receive after-care support                                                            Hotline was established to provide referrals for sen-
                                                                                                                                             San José Public Library had another remarkable
Homebuyer Program.         the affordable housing stock of the city/county of        services through the City of San José Housing                                                                    iors and support to caregivers, including out-of-
                                                                                                                                             year in FY 2005-2006. Circulation of materials
Ms. Rountree was the       San Francisco, the second highest producer Bay Area       Department staff and Collaborating Agencies                                                                      town family members who want to find help for an
                                                                                                                                             remains among the highest in the country; three
500th teacher to           region. The City proved its commitment to                 Disaster Relief Efforts (CADRE). All of these                                                                    elderly San Jose family member. The Office on
                                                                                                                                             new branch libraries funded by the 2000 Library
purchase a home            affordable housing when we successfully reached our       families received Section 8 Housing Vouchers from                                                                Aging is providing written materials in multiple lan-
                                                                                                                                             bond measure successfully opened and we broke
through THP. Delighted     goal of having 10,000 affordable homes built or           the Housing Authority, and move-in financial assis-                                                              guages such as Spanish, Mandarin, Cantonese, and
                                                                                                                                             ground on two replacement libraries. 2005-06 was
to have their teacher in   under construction over an eight-year period. We          tance from the City of San José and the Housing                                                                  Vietnamese.
                                                                                                                                             the first full year when customers could both register
their neighborhood, her    celebrated this accomplishment by breaking ground         Industries Foundation. The City also provided the       for a card online and pay fines online, saving hours
students and their         on Paseo Senter, an $83 million complex with 218          families with furniture for their new home.                                                                      As the City of San José continues to grow, embrac-
                                                                                                                                             of staff time. Our Vineland Branch became the first
parents helped out on      affordable apartments.                                                                                                                                                     ing all generations and cultures, we will continue to
                                                                                                                                             library in the world to have an external library
moving day. San José                                                                 The Smart Start San José (SSSJ) child care                                                                       offer our residents services that show our commit-
                                                                                                                                             automated return, check-in and sorting machine.
serves as the model for    Our Second Unit Pilot Program began in 2006,              program, which has been changing lives since 2000,                                                               ment to care.
successful and creative    allowing the limited development of secondary             provides pre-schoolers with foundation for success in   In our Park System we completed three new major
partnerships that make     residential units in San José. The secondary unit         the classroom and potential as lifelong learners.       Community Centers as well as expanding the two
it possible for teachers   pilot program could potentially provide up to 100         This past year 20 new Smart Start centers received      joint-use centers. During the 2005-2006 year our
to live in the             new housing units. We’re monitoring the program’s         mini-grant funding, creating 380 new child care         Animal Care Services (ACS) began operating a low-
communities where          success to see if it’ll become a permanent part of our    spaces and 1183 upgraded spaces. In addition, 48        cost public spay/neuter clinic in an effort to reduce
they teach.                affordable housing program.                               new Family Care Homes have been created offering        pet overpopulation within the community. Over
                                                                                     480 new spaces for the children of San José.            2900 spay/neuter surgeries have been performed
.                          Building on the many partnerships we have                                                                         since the clinic opened. The residents of San José
                           established with San Jose State University (SJSU) the     The San José After School (SJAS) program, a             joined us in caring for our animal population. 300+
                           City’s Housing Department collaborated with the           consortium of the City’s Parks, Recreation and          people went through the ACS volunteer training
                           University and Spartan Shops to launch a pilot            Neighborhood Services Department, our City of San       program in 2006; donating thousands of hours

14                                                                                                                                                                                                                                                                                        15
                         Financial Highlights

     2006-2007 ADOPTED USE OF FUNDS                                                                                       2006-2007 GENERAL FUND USES

     GENERAL FUND                                              ENTERPRISE FUNDS
        General Government                                        Airport                                $477,138,850
        City Attorney                           $12,741,927       Parking                                 22,559,691
        City Auditor                             2,454,307        Waste Water Treatment Plant             220,444,657
        City Clerk                               2,499,698        Municipal Water                         28,695,882
        City Manager                             9,137,357        Total Enterprise Funds                 $748,839,080
        Economic Development                     4,526,486
        Emergency Services                       481,667       SPECIAL REVENUE FUNDS
        Employee Services                        6,571,419        Internal Services/Operations           $146,547,834
        Finance                                  10,934,954       Housing Funds                           124,630,193
        Independent Police Auditor               727,694          Integrated Waste Management Fund        95,377,232
        Information Technology                   15,947,488       Workforce Investment Act Fund           22,903,140
        Mayor and City Council                   8,880,922        Emergency Communications System
        Redevelopment Agency                     1,356,285         Support Fee Fund                       21,960,000
                                                                                                                              General Government 8%
        Total General Government Departments    $76,260,204       Community Development Block
                                                                   Grant Fund                             21,498,898
                                                                                                                                Non-Commercial 32%                                                                                 Public Safety 40%
     Public Safety                                                Anti-Tobacco Master Settlement
        Fire                                    $128,854,031       Agreement Revenue Fund                 17,109,906
                                                                                                                              Community Service 13%                                                                                Capital Maintenance 7%
        Police                                   256,128,940      Gas Tax                                 17,000,000
        Total Public Safety Departments         $384,982,971      Convention and Cultural Affairs Fund    16,269,762
                                                                  Transient Occupancy Tax Fund            13,676,224
     Capital Maintenance                                          Storm Sewer Operating Fund              19,667,794
        General Services                        $20,395,398       Special Asessment Districts             12,721,421      FIVE-YEAR COMPARISON OF GENERAL FUND USES
        Public Works                             9,717,193        Library Parcel Tax Fund                 9,297,688
        Transportation                           33,364,908       Other                                   39,226,005
        Total Capital Maintenance Departments   $63,477,499       Total Special Revenue Funds            $577,886,097

     Community Services                                        CAPITAL FUNDS                                                  350
        Environmental Services                  $1,664,344        Airport                                $551,256,315
        Library                                  28,094,246       Parks and Community Facilities          303,016,737         300
        Parks, Recreation and                                     Public Safety                           130,209,766
         Neighborhood Services                   61,497,871       Library                                 123,580,352
        Planning, Building and Code                               Traffic                                 77,238,967
         Enforcement                             37,116,424       Sanitary Sewers                         55,120,526
        Total Community Services Departments    $128,372,885      Water Pollution Control                 71,820,705          200
                                                                  Service Yards                           13,424,786
     Non-Departmental                                             Other                                   57,670,392          150
        City-Wide Expenses                      $113,235,009      Total Capital Funds                    $1,383,338,546
        Capital Contributions                    23,073,635
        Transfers                                28,925,668    TOTAL USE OF FUNDS (GROSS)                3,666,892,882        100
        Earmarked Reserves                       88,979,283    LESS INTERFUND TRANSFERS                  -656,386,184
        Ending Fund Balance                                    TOTAL CITY USE OF FUNDS (NET)             $3,010,506,698        50
        Contingency Reserve                      27,005,000
        Encumbrance Reserve                      22,517,005                                                                      0
        Total Non-Departmental Uses             $303,735,600                                                                          General Government        Public Safety    Capital Maintenance    Community Service   Non-Departmental

     TOTAL GENERAL FUND                         $956,829,159                                                                         2002-2003 Actuals     2003-2004 Actuals    2004-2005 Actuals      2005-2006 Adopted    2006-2007 Adopted

18                                                                                                                                                                                                                                                          19
     City Council Appointees & Senior Staff

     Council Appointees

     Barbara Attard          Independent Police Auditor
     Les White               Interim City Manager
     Richard Doyle           City Attorney
     Harry Mavrogenes        Redevelopment Agency Director
     Lee Price               City Clerk
     Gerald Silva            City Auditor

     City Manager’s Office

     Les White               Interim City Manager
     Kay Winer               Chief Deputy City Manager
     Mark Linder             Deputy City Manager
     Dan McFadden            Interim Deputy City Manager
     Deanna Santana          Deputy City Manager
     Ed Shikada              Deputy City Manager
     Tom Manheim             Public Outreach Manager
     Nadine Nader            City Council Liaison
     Betsy Shotwell          Intergovernmental Relations

     Senior Staff

     Katy Allen              Public Works Director
     Albert Balagso          Parks, Recreation & Neighborhood Services Director
     Mark Danaj              Human Resources Director
     Rob Davis               Chief of Police
     Alex Gurza              Employee Relations Director
     Jim Helmer              Transportation Director
     Joe Horwedel            Planning, Building & Code Enforcement Director
     Peter Jensen            General Services Director
     Scott Johnson           Finance Director
     Leslye Krutko           Housing Director
     Paul Krutko             Economic Development Director
     Jane Light              Library Director
     Larry Lisenbee          Budget Office Director
     Randall Murphy          Interim Chief Information Officer, Information Technology
     Ed Overton              Retirement Director
     Bill Sherry             Airport Director
     Kimberly Shunk          Emergency Services Director
     John Stufflebean        Environmental Services Director
     Darryl Von Raesfeld     Interim Fire Chief                                          Credits:
                                                                                         Compiled and written by Mona Favorite-Hill with the contribution from City Departments and Directors.
                                                                                         Edited by Tom Manheim. Original design concept by Paul Asper, City of San José Redevelopment Agency.
                                                                                         Design by the Max Davis Company. Cover photo, ZeroOne by Chris Ayers. Back photo, Holiday Parade 2006
                                                                                         by Andrew Rafkin. A publication of the Public Outreach Office.