On Tuesday, the city of Napa is slated to react to the county’s warning — either promise water to the Napa Pipe housing and retail development, or watch the county pursue other water sources instead.
The City Council has scheduled a discussion on the message the Board of Supervisors has handed down over water service to Napa Pipe. Councilmembers must decide how to respond to county supervisors’ declaration they would look at groundwater and other options if the city doesn’t sign a water supply agreement by the end of the month.
A memo to the council from Rick Tooker, community development director, formally called on councilmembers only to “provide direction to staff.” But Tooker emphasized the city’s stance that Costco should be built before any housing is started – a key issue for the city in its talks with the developer, Napa Redevelopment Partners.
In development for years, the project, on 154 acres of dormant industrial land along the Napa River south of town, is designed to include as many as 945 homes as well as a hotel, shops, office space, trails, parks and a warehouse-style store expected to become part of the Costco chain.
Supervisors on June 9 sought to turn up pressure on the city to deliver Napa Pipe a will-serve letter guaranteeing it municipal water. They called the lack of a water agreement a peril both to the Costco store and the county’s plans for state-required housing, which lean on Napa Pipe’s creation.
The state mandates the county add 180 residences in rural areas by 2022. The city, in its agreement to provide services to Napa Pipe, also accepted 80 percent of the county’s state housing requirement to protect agricultural land outside the cities, a share considered nearly impossible to reach without Napa Pipe.
The Costco-first issue is the last sticking point keeping the city from providing Napa Pipe with water, according to Tooker. While the 2013 city-county memorandum on the project called for a development agreement to specify a complete, operational warehouse store in Napa Pipe’s first phase, the county pact signed by the developer last year only asks “diligent and good faith efforts” to open such a store, providing for substitute payments by the developer if such efforts stall.
Tooker, speaking to the Board of Supervisors last week, said if housing precedes a Costco at Napa Pipe, the city wants the developer to pay it the money a city-county economic study has predicted would flow to the city from a warehouse store, at least $1 million annually.
Instead, Napa County’s agreement with Napa Redevelopment Partners allows housing to begin without a Costco after two years. In that case, the developer would make substitute payments to cover police, fire and other public services at the development.
The city, however, has called those in-lieu payments a poor fill-in for a Costco, starting at only $214,000 a year in the first phase of Napa Pipe. Launching the development with homes instead of a warehouse store would slash city revenues by $2.5 million during the project’s first three years, Tooker told the Board of Supervisors.
The council is expected to take up the Napa Pipe issue at its 6:30 p.m. session at City Hall on Tuesday.