Napa County wants to help owners of small, family-owned wineries who say they are being bled by budget-busting bureaucracy, though details of how to accomplish this are still to come.
County supervisors on Tuesday talked about possibly modifying winery regulations. They could streamline how proposed, small wineries meeting certain criteria obtain use permits. They could simplify ways for wineries to make minor, non-controversial changes to use permits.
Board of Supervisors chairperson Ryan Gregory noted that adding one employee is considered a major modification to a winery use permit, which among other things triggers a Planning Commission hearing. A business needs an employee tomorrow, not three years and $100,000 later, he said.
“Businesses out there need to expand and change way faster than county government is in a position to permit them,” he said. “That leads to all kinds of issues, compliance being one of them.”
County staff will prepare a small winery ordinance for Board of Supervisors consideration at a future meeting. Along the way, it will reach out to residents who express an interest.
“Let’s get people talking about it,” Supervisor Brad Wagenknecht said.
Supervisors heard from more than 15 people during public comments at the meeting, some of whom made requests that appeared to go beyond what supervisors are considering.
Attorney Lester Hardy said making the smallest changes to employee or visitor numbers requires seeking a major modification. That triggers studies and perhaps having to meet new county driveway standards that might cost a quarter-million dollars to a half-million dollars.
“The result is you have a regulatory scheme in place right now that threatens to put the small winery owner with limited resources out of business,” Hardy said.
Timm Crull owns The Terraces winery in the Rutherford area. He said that the winery used to sell 95 percent of its wine through distributors, but that changed in the 2000s. Today, without direct-to-consumer sales, the winery would not exist.
“Quite frankly, my wife and I would prefer not to have to work on Saturdays and Sundays doing tastings,” Crull said. “We would like to have two days off. But that is not an option.”
They get calls from people who want a Napa Valley experience that is different from the large wineries and he hopes to preserve that, Crull said.
The Terraces winery is among 19 wineries that asked the county for clarification of their use permits under the county’s code compliance program. Results could mean asking the county for permit changes on visitation and other issues to legalize what’s already happening.
Estimated costs associated with a major modification could cause them to have to sell their ranch, Crull said. Over the last 15 years, the winery has brought in a total of $622,000 in net income, he added.
“I would love to pass (the operation) onto my children,” Crull said with a catch in his voice. “But it may not happen.”
Bill Keever of Keever Vineyards said his winery permit allows him to produce up to 10,000 gallons annually. He must take the same steps to add a few employees and visitors as a 500,000 gallon-a-year winery adding 300,000 gallons of production and 40 employees.
“I have to do every single thing that large winery has to do to get my major mod approved and it seems almost impossible to accomplish,” he told supervisors.
Resident Bernadette Brooks brought up the issue of what is considered a small winery. She suggested a small winery makes 10,000 gallons annually of wine or less.
The county defines a small winery as one producing 30,000 gallons annually or less. That accounts for 261 of the 461 wineries in unincorporated, agriculturally zoned areas, or 57 percent, a county report said.
Planning, Building and Environmental Services Director David Morrison said the definition of small winery varies from one community to another. In Yolo County, for example, it’s a winery producing 100,000 gallons annually or less. Napa County chose 30,000 gallons.
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“I don’t know that there’s necessarily any magic to that number,” Morrison said.
Tom Davies of V. Sattui winery challenged the visitor caps that the county assigns to each winery. Most wineries are to track the number of visitors, usually in log books, and not exceed assigned daily, weekly and annual numbers that vary winery-to winery.
The county applies rules to wineries made a few decades ago and the model of selling wine has changed, he said. Wineries today rely less on distributors and more on direct-to-consumer sales.
Davies suggested the county let infrastructure at a winery limit visitation, employees and production. He mentioned such factors as water availability and parking spaces.
Resident Steven Rea agreed, adding no one tells Gott’s Roadside restaurants how many people can come in and buy their burgers.
County supervisors voiced various thoughts on the topic.
“Visitation is a challenge,” Gregory said. “The thing I struggle with is every project that comes forward, our Planning Commission is struggling with what’s the best visitation number on a case-by-case basis.”
Supervisor Diane Dillon said years ago there was a hue-and-cry for some sort of winery visitation chart, something more standardized. But she views a winery on a major road such as Silverado Trail or Highway 29 in Napa Valley as being different than one at the end of a narrow, dead-end road in the mountains.
“I do not think we can go to a one-size-fits-all,” Dillon said.
Supervisor Belia Ramos agreed. Roads serving wineries are probably the greatest limiting component, she said.
“Yet those figures don’t come before us in data,” Ramos said. “They come more anecdotally from comments and concerns through neighbors. I think if we acknowledge it as part of the process, it will help shed light on what truly those infrastructure limitations are and let that be a guiding light for us.”
Dillon also talked about the 1990 Winery Definition Ordinance that sets many of today’s winery rules. The environmental impact report for the law warned of gridlock from tours and tastings with no limits, she said.
Some people might question why the county has wineries count visitors and adhere to other rules, Dillon said. It was a deal made in 1989 and 1990 in the face of harsher recommendations from the environmental impact report consultants, she said.
“To state that there were overriding considerations made by the Board is an understatement,” she said.
Changing winery definition ordinance mitigations related to the environmental impact report could trigger a new environmental impact report, Dillon said. That would take years to complete. But she wants to do something to help small wineries.
“The small wineries cannot compete with the large ones because of the distribution system,” she said.
Gordon Valley grapegrower Bill Wolf asked supervisors to consider the small family farms that don’t have a winery, but make wine at a custom crush facility. He wants these farms to have the ability to host a limited number of tasting visitors.
“All we’re asking for very simply is a category that allows us to make a living,” Wolf said.
It was unclear when a proposed small winery ordinance will take shape and return to the Board of Supervisors. Supervisors said they want to move quickly and also at some point hold a joint meeting with the Planning Commission that hears winery use permit applications.
“I would like to find a way to work with the small wineries to have a place in Napa,” Supervisor Alfredo Pedroza said.