Several possible future residents of the planned Redwood Grove condominiums watched as the Napa County Board of Supervisors provided more money to keep the project on track for a summer of 2020 completion.
The $15.9 million, 34-unit affordable housing project faces a $1.3 million funding gap because of rising mortgage interest rates. Burbank Housing, a nonprofit, is asking both Napa County and the city of Napa to provide $650,000 apiece so construction can begin.
Supervisors agreed on Tuesday, with a final vote scheduled for a future meeting, bringing the total county loan for the project to $1.67 million. The Napa City Council has yet to take up the request.
Sasha Levine prequalified for a chance to buy one of the condominiums on 2033 Redwood Road. She urged supervisors to make the loan so Redwood Grove can be built.
Levine and her husband rent an apartment for their growing family – she appeared at the lectern with her infant daughter. She is a hospitality worker at an Upvalley winery.
“Being a millennial, we work very hard, and we seem to just barely make it,” Levine said. “To ever own a home in California seems to be far-fetched. We have family out of state, but I was born and raised in California and want to stay here.”
Without a project like Redwood Grove, they might not be able to buy a home for 20 or 30 years, she said.
“You’re the reason it’s important to us,” Board of Supervisors Chairman Brad Wagenknecht replied.
John Bertolini also hopes to be a Redwood Grove buyer. He is headmaster at Kolbe Academy & Trinity Prep, which is next door to the Redwood Grove property.
His family has been in Napa since 1986. His parents bought a three-bedroom, two-bathroom house in Napa’s Bel Aire neighborhood that year for $103,000. The median housing price in the county today is more than $650,000.
Redwood Grove is a very important project, Bertolini said.
“It’s going to enable people like me to stay in Napa,” he said. “A lot of my friends have moved from Napa, to different states even … I’m glad to see the city and county are making this a priority.”
Larry Florin of Burbank Housing said Redwood Grove has generated tremendous community interest. About 800 potential buyers attended information meetings.
Almost 100 people have prequalified to try to become buyers. Of those, 27 work in the wine industry, 15 are county or city employees, nine are school district employees and seven work in hotels, he said.
All but three of those 100 people live or work in Napa County, Florin said.
“That’s incredible,” Supervisor Ryan Gregory said. “That’s a great stat.”
Wagenknecht expressed concern that some affordable housing projects keep asking the county for more money. He said he’s worried that costs might be low-balled initially to make projects seem more attractive.
“My preference would be to know as much as we possibly can, the full extent of what is going to be asked of us,” he said, adding the “outside envelope” should be presented from the start.
Napa County agreed in June 2017 to lend the Redwood Grove project $900,000. It agreed in November 2017 to lend an additional $125,000, for the total of more than $1 million. The city of Napa made identical loans.
That makes the latest, $650,000 request the third time Burbank Housing has come to the Board of Supervisors to obtain loan money for Redwood Grove.
Florin said mortgage interest rates have risen dramatically, from 4.25 percent to 5.6 percent and could reach close to 6 percent. That affects the 30-year fixed rate for the mortgages required of all Redwood Grove buyers.
Rising interest rates means the buyers can borrow less money, Florin said. The total amount generated by all the mortgages has fallen from original estimates, creating the $1.3 million gap that must be filled to build the project.
Florin said Burbank Housing is trying to lower construction costs as much as possible and hopes not to use all of the funds.
“This is sort of the outer limit,” Florin told supervisors. “We absolutely will never be back for any other request.”
Napa County is taking money for the Redwood Grove loans from its affordable housing fund. The fund began the 2018-19 fiscal year with $4.1 million available to spend, a county report said.