Many of the homeless moved a short half-mile away to vacant city-owned land. The state effectively dumped the problem onto San Jose, and the homeless are flocking here now because of the acres of open space.
"Pretty much we're starting to get crowded now," said homeless camper Monica Carrasco.
So the city is preparing to do what the state did: Shut it down and move the homeless out within 30 days.
"The Mayor's in a hard spot. This is not the city's problem per se. They have no resources to deal with this," said David Wall, who lives in the neighborhood.
The cost of dismantling and cleaning up the tent city is estimated at $40,000. The city will have to foot the bill for taking down the tents and other structures that have sprung up. It will have to haul away garbage that's accumulating and posing a health risk, and the city is counting on social service agencies to find temporary shelter for 75 to 100 people.
"These folks are mobile, and they will move from place to place. But I think we have to pay attention to it because it does get a lot worse if it's not tended to," San Jose Mayor Chuck Reed said.
The mayor is particularly concerned because the site is near public transit, and if not shut down, it will become a magnet for homeless from other parts of the region.
Even after the encampment is removed, San Jose will have to rely on its understaffed police department to patrol the site to discourage people from resettling.
Ray Bramson, homeless encampments project manager, said: "They're trying to give us the best tools and best resources that they have available to keep the area clear."