UPDATE: Cupertino mayor optimistic about city’s future

Cupertino’s mayor wants to continue fostering city partnerships, prioritizing housing needs and supporting various programs that enhance the community’s quality of life.

Mayor Sheila Mohan said Thursday night at the 2023 State of the City address that Cupertino plans to continue adding affordable and market-rate housing as it waits for state approval of its housing plan. She also discussed how Cupertino plans to balance its budget with an anticipated $15 million deficit going into the 2024-25 fiscal year, largely due to an audit of Apple’s sales taxes.

Mohan said while housing and the city’s budget need to be addressed, she’s optimistic that partnerships with businesses and organizations such as the Cupertino Chamber of Commerce and the Rotary Club of Cupertino will boost the city’s commitment to community needs.

“Everything that the city does is driven by our commitment to providing exceptional service and staying true to our mission of furthering education, innovation, and collaboration – these are the hallmarks of Cupertino,” she said in her speech.

Mohan said housing will be a priority in the coming year as more developments come online.

To accommodate its residents, the city must provide 4,588 new homes — 1,880 of which must be affordable — by 2031 to meet its housing element goals. Mohan said the city expects the state’s stamp of approval in April, more than a year past the deadline.

Housing advocates won a judgment against the city last month after it failed to secure state approval for its housing plan by the Jan. 31, 2023 deadline.

Vice Mayor J.R. Fruen said he wants the city to go beyond the state’s housing requirements, to better support its senior and younger adult workers. This month, Cupertino held a lottery for affordable senior housing, and the Vallco Mall housing site is expected to break ground this year after scaling back in 2023.

“We as a city and as a region have underbuilt housing for over 40 years,” he told San José Spotlight. “That is one of the reasons that we have the housing crisis and we have to step forward to help solve that.”

Cupertino has a population of more than 57,800 residents, according to 2022 data from the U.S. Census Bureau. The city’s population is predominantly Asian at 70.2%, followed by the white at 22.7%, according to 2022 census data.

Kathee Kraker, a retired nurse and resident of the city for roughly 35 years, said she wants to see the city prioritize solutions for homelessness and efficient public transportation. Kraker said she wants the city to build upon existing programs to address housing rather than creating new programs that use more funding.

“So much has been spent on housing,” she told San José Spotlight. “It just kind of seems to keep going.”

The mayor also addressed the community’s vitality, including its parks and clean energy focus. Last year, the city opened Regnart Creek Trail and boosted Silicon Valley Hopper, a ride-share program that provides reduced rates for riders, traveling between Cupertino and Santa Clara. The city plans to transition to all-electric cars this spring as part of the program and add more charging stations.

“These projects are not merely items to check off on a to-do list but opportunities to create innovative solutions,” she said. “Let’s embrace these opportunities and others this year.”

As for the budget, that needs to be balanced by June 30. Mohan said the city needs to boost revenue and scale back expenditures by cutting vacant city positions and reducing city services such as road maintenance.

“Recent economic conditions are steering our focus towards fundamentals,” Mohan said during her speech. “It’s a temporary revisit to our humble beginnings.”

Fruen agreed that the city needs to increase revenues and decrease expenditures.

“We’ve gotten very used to over a long period of time, a certain level of service,” he said. “It’s always difficult when things might need to change.”

Last year, California’s Department of Tax and Fee Administration required Apple to reimburse the state by roughly $20 million after it conducted an audit, affecting Cupertino’s agreement with the tech giant. Under a longstanding tax sharing agreement between the city and Apple, dating back to 1998, the company designated all online product sales to California residents as taking place in Cupertino, and allocated the local 1% portion of the state’s 7.25% sales tax from those transactions to the city.

“We’ve never been in a position where we have had to deal with a deficit,” Mohan told San José Spotlight. “We will have to do that this year, but it’s not insurmountable.”

Mohan said by working in conjunction with city groups, Cupertino will be able to thrive and find solutions to its budget and housing needs.

“We recognize that this journey is ongoing,” she said during her speech. “And in the spirit of togetherness, we must  face any current or future challenges head-on alongside our many wonderful  partners.”

Contact Annalise Freimarck at [email protected] or follow @annalise_ellen on X, formerly known as Twitter.