Senate Bill 743 (SB 743) requires local jurisdictions to use Vehicle Miles Traveled (VMT) instead of Level of Service (LOS) to analyze transportation impacts under the California Environmental Quality Act (CEQA). City staff developed a new citywide VMT policy to comply with State law and provide established and consistent criteria for analyzing transportation impacts of development projects and long-range plans. The VMT policy aligns with the goals and policies of the General Plan and adopted plans and supports new development in suitable areas near transit, mixed-use neighborhoods, and other amenities.

VMT measures the amount and distance a project might cause people to drive. Typically, isolated developments with poor access to walking, biking, and public transit facilities will result in more driving than mixed-use developments in already developed areas with strong access to non-automobile travel. This Fehr & Peers YouTube video provides a simple and clear explanation of VMT.

The City Council adopted the VMT policy on May 18, 2021. For more information about the VMT policy and the City’s efforts to transition from using LOS to VMT, please refer to this agenda report and presentation to the City Council. The final VMT policy with the City’s VMT heat maps can also be accessed here.

In 2013, the State of California signed into law Senate Bill 743 (SB 743), which changes how transportation impacts are analyzed under the California Environmental Quality Act (CEQA). The law establishes Vehicle Miles Traveled (VMT) as the appropriate methodology for measuring transportation impacts. The State gave cities a July 1, 2020 deadline to begin implementing the new law.

Historically, Milpitas and other jurisdictions have used Level of Service (LOS) to analyze impacts to transportation infrastructure under CEQA. LOS assigns a letter grade (A through F) to intersections or roadway segments based on the level of traffic congestion. California jurisdictions have been using LOS to analyze a project’s CEQA transportation impacts since the inception of CEQA in 1970.

California has shifted away from using LOS because measuring congestion at intersections and roadway segments can have the unintended consequence of encouraging urban sprawl. To avoid triggering significant impacts and the cost of mitigating those impacts, new developments may locate in more remote areas with minimal traffic congestion. This often results in greater vehicle use and traffic congestion overall because people must travel longer distances to reach destinations. The State is recommending using VMT to measure of transportation impacts because it encourages infill and mixed-use development and the use of active transportation and transit, which reduce greenhouse gas emissions and promote healthier lifestyles.

What is CEQA?

The California Environmental Quality Act (CEQA) requires State and local agencies to measure the environmental impacts of development projects or other major land use decisions, and to avoid or minimize those impacts when possible. For example, if a developer wants to build a new shopping center or residential development, they will likely have to prepare some form of environmental report that analyzes all the potential impacts of the project on transportation, air quality, utilities, biological resources, and other environmental topics

How does CEQA require public agencies to measure transportation impacts?

Environmental reports prepared to comply with CEQA must analyze all the potential impacts of the project on various environmental topics, including transportation. Traditionally, public agencies have evaluated transportation impacts by measuring the impact of proposed developments on traffic congestion. For decades, Level of Service (LOS) has been the industry standard used to measure transportation impacts.

What is Level of Service (LOS)?

Transportation Level of Service (LOS) is a measure of traffic delay at signalized street intersections or roadway segments (i.e., traffic congestion). Level of Service uses a letter-grade system ranging from LOS A to LOS F. LOS A indicates free flow conditions with little or no delay. LOS F indicates oversaturated conditions with excessive delays. LOS analysis measures the amount of vehicle traffic a project will generate at signalized intersections, then seeks to accommodate the additional traffic either by improving or expanding existing intersections. As such, LOS supports and prioritizes automobile travel over other modes of travel (e.g., walking, biking, transit, etc.).

What is Vehicle Miles Traveled (VMT)?

Vehicle Miles Traveled (VMT) measures the amount and distance a proposed development project might cause people to drive. The diagrams below illustrate how VMT is measured.

Typically, development located farther from retail, office, and other uses and with poor access to transit, generates more driving than development situated close to complementary uses and transit. VMT analysis seeks to minimize how much people travel by car by locating projects in already developed areas with diverse land uses and encouraging non-vehicle travel (e.g., walking, biking, transit, etc.). VMT prioritizes access to destinations rather than dependence on cars for travel.

Why is the City changing its method for analyzing transportation impacts?

In 2013, the State of California passed SB 743 (Steinberg), which changes the way transportation impacts must be analyzed under CEQA. Historically, cities in California have used LOS to measure transportation impacts. However, the State established VMT as the appropriate methodology for measuring transportation impacts and updated the CEQA Guidelines in 2018 to reflect this transition from LOS to VMT . The State also established July 1, 2020 as the date for cities to begin implementing the new law.6. Why did the State pass legislation to adopt this change?

SB 743 (Steinberg) states that “New methodologies under the California Environmental Quality Act are needed for evaluating transportation impacts that are better able to promote the State’s goals of reducing greenhouse gas emissions and traffic-related air pollution, promoting the development of a multimodal transportation system, and providing clean, efficient access to destinations.” The State has shifted away from using LOS because measuring congestion can have the unintended consequence of encouraging urban sprawl. Under LOS, new development is incentivized to locate in more remote areas to avoid increasing traffic congestion on busy streets and triggering significant transportation impacts under CEQA. This often results in greater vehicle use and traffic congestion overall because people must travel longer distances to reach destinations. The State has selected VMT as the new methodology because it can help achieve the ultimate goals of CEQA, such as reducing greenhouse gas emissions and minimizing environmental impacts. VMT encourages developing in already developed areas and the mixing of uses, which reduce the need for vehicle travel. VMT also encourages the use of active transportation and transit, which have smaller environmental footprints than vehicle travel and promote healthier lifestyles. Furthermore, VMT is already used in CEQA documents to calculate LOS impacts, air quality, and greenhouse gas emissions.

What does this mean for the City of Milpitas’s ongoing current and long-range planning efforts?

Although the State deadline to implement SB 743 has passed, the City of Milpitas will be implementing an interim VMT policy to review ongoing development projects until a formal policy is adopted in December 2020.  Furthermore, since the City is currently in the process of updating its General Plan, Climate Action Plan and Milpitas Metro Specific Plan (formerly “Transit Area Specific Plan”, we have a unique opportunity to align our VMT goals with the City’s ongoing long-range planning efforts.

The City’s General Plan is the primary long-range planning document that provides the vision for the future growth and development of Milpitas. The VMT policy will support the following existing General Plan policies:

  • Land Use Element Guiding Principle 2.a-G-2: Maintain a relatively compact urban form. Emphasize mixed-use development to the extent feasible, to achieve service efficiencies from compact development patterns and to maximize job development and commercial opportunities near residential development.
  • Land Use Element Implementing Policy 2.a-I-31: Develop the Transit area, as shown in the Transit Area Plan, as attractive, high density, urban neighborhoods with a mix of land uses around the light rail stations and the future BART station. Create pedestrian connections so that residents, visitors, and workers all walk, bike, and take transit. Design streets and public spaces to create a lively and attractive street character, and a distinctive identity for each sub-district.
  • Land Use Element Implementing Policy 2.b-I-2: Consider locating housing in close proximity to industrial developments where they can be served by existing city services and facilities.
  • Circulation Element Implementing Policy 3.b-I-5: Create a balanced multimodal transportation network that meets the needs of all users of streets, roads, and highways for safe and convenient travel in a manner that is suitable in respect to the community context of the general plan.
  • Circulation Element Guiding Principle 3.c-G-1: Implement measures that increase transit use and other non-motorized travel modes that lead to improved utilization of the existing transportation system, such as improvements to access public transit stops and stations by walking and biking, and provide transit stops near employment centers and higher density residential developments.
  • Housing Element Program C.1.2: The City will continue to implement the planning and design guidelines specified in the Midtown and Transit Area Specific Plan, including minimum densities, intensive land utilization, and mixed-use zoning.

The ongoing General Plan Update will revamp these land use and transportation policies to further support transit-oriented, mixed-use development, particularly around the new BART station and in Midtown, and prioritize investment in multimodal transportation networks. The VMT policy will support these policies by: (1) facilitating mixed-use, infill, and transit-oriented development; and (2) prioritizing active transportation and transit improvements to mitigate project impacts. Staff will also develop the VMT policy in conjunction with ongoing updates to the Climate Action Plan and the Milpitas Metro Specific Plan to ensure that the policy furthers the goals and policies of these ongoing long-range planning efforts as well.

What is the timeline for these changes?

The State established July 1, 2020 as the date for cities to begin implementing the new law. However, many cities, including Milpitas, are still in the process of adopting new VMT policy and guidelines. The State recognizes this and allows cities to implement VMT methodology without an established policy after the July 1, 2020 deadline. Without a new VMT policy in place, new development in Milpitas is currently required to measure transportation impacts using VMT methodology on a project-by-project basis and continue to measure Level of Service (outside of CEQA) to comply with the Santa Clara Valley Transportation Authority’s (VTA’s) Congestion Management Program (CMP) and existing General Plan policies. It is anticipated that the new VMT policy will be in effect immediately after City Council approval tentatively scheduled for December 2020.

Does my ability to engage in land use and transportation decisions change?

No. The process for weighing in on development projects, land use changes, and transportation projects will remain the same. Citizens will still be able to provide comments, speak at public hearings, and contact elected representatives on new development. The City Council still has the authority to make land use and transportation decisions.

How will this change impact the City’s ability to ask developers for transportation investments?

Neighborhood traffic and mobility is very important to the City. Developers will still be required to improve operations to the transportation network and address neighborhood traffic. In addition, any transportation/traffic impact fees established by Ordinance are still applicable.

How will the CEQA process change?

Although the method of transportation analysis will change, the overall CEQA process (determination of appropriate CEQA document, noticing, public comment period, adoption, etc.) will remain the same. This change to VMT only affects the transportation section under CEQA. Analysis of other CEQA subject areas such as biological and cultural resources, noise, and air quality remain the same. However, the CEQA process for projects that reduce VMT and reliance on automobile travel (e.g., mixed-use, transit oriented, and infill development; bicycle, pedestrian, and public transit improvements) will generally be streamlined while the CEQA process for projects that generate high VMT (e.g., developments in remote areas with minimal access to goods, services, amenities, and non-vehicular transportation options) will require a more rigorous environmental analysis.

Will the shift to VMT make it easier or harder to develop in my neighborhood?

It depends on the type of development. Every development project is unique and will be evaluated according to its specific attributes and context. However, in general, the CEQA environmental review process could be streamlined if development is proposed in General Plan designated growth areas with good access to transit and a mix of uses (e.g. residential, office and retail). Developments in places where it is hard to get around without a car will likely have to mitigate the impacts of VMT.

How will the shift to VMT impact new development projects?

New development projects subject to CEQA will still be required to submit a traffic impact analysis, but project impacts will be evaluated based on measuring and reducing VMT. Therefore, mixed-use developments in growth areas, located near transit, are more likely to be streamlined or determined to have a less than significant transportation impact. Proposed developments outside growth areas and transit corridors may need to provide mitigation to reduce transportation impacts. However, in addition to the VMT analysis and outside of CEQA, projects will continue to be required to analyze Level of Service (LOS) intersection operations and comply with the Congestion Management Program (CMP) requirements to address local traffic congestion.

How will this change impact housing and housing affordability?

The proposed Transportation Analysis Policy and shift to VMT is intended to streamline residential development overall, particularly high-density housing, affordable housing, and housing in already-developed areas with high-quality transit and other amenities. This streamlining should allow for a greater and more diverse housing supply and result in lower housing costs. Importantly, it will also lower transportation costs as new development is concentrated in areas with a variety of affordable transportation options. This is a key argument made by the State in support of the VMT policy.

How does this change impact the environment?

Level of Service (LOS) is a measure of how much delay is at an intersection when the traffic a project is expected to generate is added to the surrounding area. In many cases, using the LOS methodology accommodates additional vehicles from projects by widening intersections and roadways. However, widening streets is shown to encourage even more cars on the street, often resulting in continued traffic congestion. Additionally, new developments are incentivized to locate in remote areas where there is little traffic congestion, which results in longer vehicle trips. More driving leads to greater greenhouse gas emissions. Furthermore, development in remote areas typically have a higher overall environmental footprint than infill development (i.e., development in already-developed areas).

Alternatively, VMT measures the amount of vehicle travel that would be generated by a proposed development based on the project characteristics and location. Factors such as high-quality transit and proximity to walkable, bikeable places are all contributing factors to reducing VMT. By establishing a VMT CEQA metric, projects will be required to reduce the amount of vehicle travel the project will generate and should result in less traffic overall and lower greenhouse gas emissions.

What are the impacts on business?

Similar to impacts on housing developments and all development projects, nonresidential land uses (commercial retail and service, office, industrial, etc.) that conform to the General Plan and are in growth areas with high-quality transit may not have to analyze transportation impacts under CEQA, which may streamline the environmental review process. Nonresidential development projects that provide essential goods, services, and amenities to nearby residential neighborhoods (e.g., locally-serving or neighborhood commercial uses) may also not have to analyze transportation impacts since they typically reduce driving. Furthermore, this shift to using VMT may facilitate denser and pedestrian-oriented development, which could result in more foot traffic and is generally favorable to commercial retail and service businesses.

How are transportation impacts minimized or mitigated now compared to before?

Previously under LOS analysis, CEQA impacts were determined by measuring how much traffic congestion a project will cause at nearby street intersections. Therefore, CEQA mitigation focused on accommodating the additional traffic by improving or widening streets and intersections, which actually may increase driving and congestion in the long-run. Furthermore, building new streets and widening existing streets requires valuable land, which may not be readily available in built-out cities, and is costly to maintain.

Now with VMT analysis, CEQA mitigation focuses on reducing driving and dependence on cars. There are four key ways to lower VMT and mitigate transportation impacts.

  1. Project location, density, and diversity of land uses: Locate projects in areas with strong transit access, pedestrian and bicycle facilities, and complementary land uses. Design projects with higher densities and a mix of uses.
  2. Improvements to pedestrian, bicycle, and public transit networks: Encourage people to walk, bike and take public transit by making it easier and more convenient to travel without a car.
  3. Parking strategies: Do not overpark developments and even reduce parking where appropriate.
  4. Transportation Demand Management (TDM): Require employers to implement TDM strategies such as shuttle services and transit passes to incentivize employees to drive less to work.

In the past 50 to 70 years, suburban cities have been investing heavily in infrastructure for cars (i.e., streets and highways), but not significantly in any other transportation options. This next phase of transportation investment will focus on maximizing the existing transportation system in a healthier, more affordable, and more efficient way.

How will this change impact parking?

The goal of using VMT is to reduce driving and increase walking, biking, and taking public transit. Not overparking developments and reducing parking where appropriate is an effective way to reduce VMT and accomplish this goal. However, residents may be concerned about cars from new developments parking in existing neighborhoods (i.e., spillover parking). Reducing parking may not be appropriate in every neighborhood. Therefore, the City will carefully consider and tailor any parking strategies to the existing context. For example, cities have implemented residential parking permit programs that provide some assurance to neighboring communities that new development cannot park in their neighborhood. Cities have also included a condition of project approval that require new developments to include enforcement strategies to ensure future residents do not park in surrounding areas.

Additionally, the goal is to reduce dependence on cars, and in turn reduce the amount of parking that is needed. Any parking reductions will be complemented by mixed-use, transit-oriented development and improvements to alternative transportation options such as bus and bicycle networks, which make it easier to travel to destinations without a car.

Contact Us

If you have a comment or question about this project, please contact the staff project manager Jay Lee. Your message will be reviewed by City staff.

Planning Department
PlanningDepartment@milpitas.gov 
(408) 586-3279
455 E. Calaveras Blvd.
Milpitas, CA 95035

Jay Lee, AICP Principal Planner
jlee2@milpitas.gov
408-586-3077