Two recent requests to extend city water service to properties located in the unincorporated county left Napa officials between a rock and a hard place.
The City Council was forced last week to choose between granting water service to sites outside the city’s rural urban limit or denying requests from property owners who had meticulously followed the county’s process for attaining building permits.
“Water is a sensitive issue,” Councilman Alfredo Pedroza said Wednesday. “There is a disconnect between the city and the county when it comes to approving outside water uses. The city should be included earlier in the process.”
For properties that sit beyond Napa’s city limits, water service often comes from groundwater wells. If the wells are contaminated or do not provide adequate flow, property owners typically turn to the city’s supply.
Two such sites were discussed at the April 1 council meeting: one located at 1165 Rutherford Road near Yountville; the other at 1075 Atlas Peak Road, just east of city limits. Both requests came from wineries and were primarily for fire suppression service to existing buildings.
In the case of the Rutherford Road property, Elizabeth Spencer Wines went through the county’s permitting process to improve an existing warehouse that is currently used for storage. Since the building does not have overhead fire sprinkler service, construction first required the fire safety upgrade.
After working with the county for quite some time, Elizabeth Spencer approached the city of St. Helena for water. But in July, officials determined that St. Helena did not have the capacity to provide water at the required pressure to meet the fire regulations for overhead sprinklers. Because Napa has a city water main that fronts the property, the winery approached the city about tapping into its supply.
Meanwhile, Whetstone Wine Cellars on Atlas Peak Road is currently operating without an adequate water permit. The company requested the city’s water in order to come into compliance with state law, and to provide fire suppression services to an existing building on the parcel.
Pedroza pointed out that both projects had worked with the county for years before ever broaching the subject of receiving water from the city of Napa.
“This process should be more inclusive,” he said. “At the beginning, when a business or property is going through the county for permits, they should be encouraged to come to the city of Napa and ask for water first — before they spend tons of time working with the county.”
Sedgley said that the current system forces the city into a corner, essentially compelling it to approve projects that have followed the county’s permitting rules. “If we don’t approve these requests, it makes it very difficult and somewhat unfair on the property owner,” he said.
Although the City Council voted to grant water service to both sites, it did so with some hesitation,
“It’s a balancing act for us,” said Mayor Jill Techel. “Currently, we have an adequate supply, but we want to make sure we’re approving requests wisely.”
Napa’s water system is anything but typical, said Joy Eldredge, the city’s water general manager. Historically, the city has provided service to county properties in order to extend its pipeline. This has resulted in a webbed system of sorts, with multiple service areas throughout the county.
Almost all of these county services were set up with an additional requirement that the properties be considered for future annexation into the city, should the opportunity ever arise. While the Rutherford Road property is unlikely to be annexed in the near future because of its far distance from city limits, the Atlas Peak parcel sits just outside the Napa city boundary.
Sedgley said that continuing to approve outside water service for properties close to city limits could potentially shift the Napa’s future growth.
“We’ve established the agricultural preserve and the city has a rural urban limit,” he said. “Both were put in place to control urban sprawl. So if we have these county parcels that continue to apply for water, but remain in the county. Is that ultimately endorsing city growth?”
Offering city water service to county properties is frowned upon in many North Bay communities. Dissenters argue that improving county properties with services like water is unfair, since the city does not receive any property tax revenue from the deal.
“It becomes a question of who is providing the service and who is benefiting from that service,” said Eldredge.
Some council members suggested exploring a tax-revenue sharing option for future county developments that request city services. But Councilman Peter Mott said that he sees these projects as revenue generating contracts — even without a tax-sharing option.
“We’re getting $1,100 a year on Rutherford Road, as long as there isn’t a fire,” he said at the meeting. “We’re also receiving connection fees. I look at how the revenue will help us in the long-run to replace these 100-year-old pipes to keep up the system we have here within the city.”
The city will receive a one-time connection fee of $13,620 from the Spencer winery and $21,800 from the Whetson winery. Whetson will also have to pay an additional $61,700 to the city’s water enterprise fund. Annually, each site will pay about $1,100 in water fees — less than half of what each parcel pays to the county in yearly property taxes.
Ultimately, the City Council voted 4-1 in favor of extending water service to the to county parcels, with Sedgley dissenting.
“The economy is rebounding and there is interest in developing more of the city and the county,” he said Tuesday. “So these applications are going to come up more frequently. I want to make sure we have a more clearly defined policy before we agree to these requests.”
City staff said it would continue discussions with the county on how to handle future developments outside city limits. Techel pointed out that because the city doesn’t have any pending projects to assess, now is the perfect time to revisit their current policies.