Whatever worries those living in Napa may have, the most common concern may be simply affording to live there.
That was the conclusion of a survey of townspeople that was a jumping-off point for the City Council, which on Friday held its annual workshop to set its priorities and goals in the coming months. Chief among them was grappling with a housing market where swelling home prices and rents show signs of slowing down, even as much of the 80,000-strong population slips farther behind the incomes needed to buy or rent.
A December survey of 300 Napans by Probolsky Research of Newport Beach listed housing affordability as the No. 1 issue residents want to see the city government take on, and even with a full plate of topics to cover over eight hours, Napa leaders agreed.
“It’s a crisis here, it’s a crisis in the Bay Area, and it’s a crisis across the state,” said Community Development Director Rick Tooker during the full-day workshop at the Napa Valley College library.
With median home prices surpassing $600,000, the gap for a median-income family to afford one has exceeded $300,000, Tooker told the council. Furthermore, more than a third of local families earn less than $50,000 a year, and about 40 percent of Napa’s senior citizens are low-income.
Napa in recent years has taken some steps to streamline housing construction, including a loosening of fees and regulations for those building accessory units inside or outside existing houses. But city officials on Friday called on the council to consistently give their backing to home development in smaller lots and at greater densities – even while conceding possible blowback from neighbors opposed to denser housing.
While projects such as the Stoddard West apartments behind the chain stores of Soscol Avenue may be noncontroversial, said City Manager Mike Parness, “once you try to put in accessory dwelling units or four-story housing, you get into the question of what’s more important – preserving the peace and quiet of neighborhoods that have been around for 50, 60, 100 years, or meeting a legitimate need for housing? There’s no easy answer.”
The city’s changing demographics also will require rethinking the kinds of homes to build in future decades, according to Rajeev Bhatia, urban designer for the Dyett & Bhatia planning firm of San Francisco. Napans 70 and older are expected to rise from 13 to 21 percent of the city population by 2040, he said, driving a need for more single-floor homes closer to services and businesses.
Future residents at the other end of the age scale may shape the local housing market by also seeking housing closer to central Napa and more easily reached by foot or bicycle, Bhatia told council members. He also recommended that Napa build downtown parking garages for easy conversion to office and other uses, should ride-sharing services and automated cars reduce demand for vehicle storage.
Napa’s tourists as well as its residents also were a point of debate on Friday, as officials pondered the future of a hotel market that now numbers 2,547 rooms and suites – with 675 more units approved but unbuilt. A further 1,582 rooms are part of lodging projects in various stages of city review, Tooker reported.
Given Napa’s increasing desirability to builders as well as vacationers, city directors urged the council to use its leverage to support projects in and near downtown, rather than in more distant areas where more hotel rooms are likely to increase traffic congestion and other stresses.
“Capacity is not the issue; we have the capacity,” said Parness. “We need to get the message out (to developers) about what kinds of hotels we want and where we want them, and where we don’t want them.”
Councilman Peter Mott agreed, stating his wish to move away from projects such as the Meritage, which opened in 2006 near the Napa Valley Commons office park and has expanded several times since. For such developments, he said, “at this point I’m like, no, it doesn’t support our downtown and we need our industrial land.”
Finance Director Brian Cochran predicted the continuing importance to Napa’s bottom line of hotel room taxes, which already account for a quarter of the general fund. From the current level of $22.9 million a year, bed taxes should supply $38.8 million by the 2023-24 fiscal year – nearly as much as the $39.3 million predicted to be drawn from property taxes, and well ahead of the $21.8 million projection for sales taxes.
Amid the promising outlook, however, a consultant cautioned Napa leaders to be mindful of how fickle such revenues can be – pointing to the devastation in Sonoma County caused by the October wildfires.
“As you become more dependent on hotel tax and sales tax, remember that these are the most elastic sources of revenue, the most dependent on the economy,” said Rod Gould, senior partner at Management Partners, the San Jose consultancy that helped organize the council workshop. “Look at Santa Rosa – they’re broke. They are spending money they do not have to help their residents, and their revenue has fallen off a cliff.”