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Napa Valley's affordable housing needs are affecting businesses

Napa Valley's affordable housing needs are affecting businesses

  • Updated

The Upvalley conversation regarding housing that is affordable had at least four significant events over the past two weeks. These developments shine a ray of hope for our area’s businesses who must search for employees outside our local area.

Four significant events:

The closing of Terra and Bar Terra restaurant in St. Helena after 30 years of very successful operations is the first event. Owners stated “It is mostly about staffing. It is so difficult to find someone; there are so many more businesses opening, and housing is so limited and expensive.” Local businesses continually speak of their inability to find local help and the entire community is frustrated with the growing traffic on our roads due to daily workforce travel.

The second event is the Merchant family’s public presentation of their Veranda Hotel project. The significant aspect of the Veranda Hotel proposal is that the Merchants are deliberately planning on building workforce housing onsite. One of the large challenges for Calistoga housing is the lack of available building sites. The Merchants not only understand that challenge but are willing to provide positive solutions. This is a large commitment for the Merchants because commercial housing development financing policies require the developer to subsidize or find grants/governmental loans for approximately 50 percent of the building costs.

One of the hurdles of commercial housing development is finding the non-mortgage monies for the development. The Merchants are to be applauded for their commitment to including work force housing in their hotel project.

The third event is the Calistoga City Council vote to place increasing the city’s transient occupancy tax (TOT) rate on the November ballot. The purpose of the 1 percent increase is for subsidizing work force housing. The ballot measure will include raising the TOT for all Napa cities agreeing to the tax increase. Calistoga Affordable Housing (CAH) has conducted its own research regarding tourist cities’ reliance on funding housing through taxes such as TOT and has found it to be very successful. However, CAH’s research also indicates that the TOT solution will not provide all the funding required to subsidize workforce housing. Other funding sources such as grants, low- interest governmental loans, etc. will also be needed. The research also indicated that the tourist areas that were the most successful in resolving the housing challenge were able to garner strong community support and backing. Communities that clearly understand that a diverse community that wants to be vibrant and meet the needs of its families must unite on common goals.

The fourth event is the 47-acre Yellow Rose Ranch proposal as reviewed by the Calistoga City Council. The Council’s 'no' vote was basically because it was too large in scope. Another aspect of the proposal is that the mix of housing units targeted market units (120 units) and 40-50 percent below market rate (120 percent of area median income or AMI).

Does our community really need more housing for families earning more than $136,500 per year (market rate at 150 percent of HUD AMI or $109,200 a year, HUD 120 percent AMI for family of four)? How many of our workforce families earn more than $74,000 per year, which is the ceiling for those considered “low income” families in Calistoga? Calistoga’s median family incomes for 2016 was $60,536.

According to, Napa County workers earn the following yearly wages: registered nurse-$54,795, government-$51,798, accountant-$51,248, office/administrative support-$38,479, education/training/library-$54,510, food prep-$24,323. healthcare practitioners-$85,311, healthcare support-$34,153, and protective services $46,925. The Napa County median salary is $59,000. Do we need housing for families earning $109,200, or do we need housing for families that average $59,000?

These four events could indicate that the upper Napa Valley is finally coming together as a community that intends to continue working for the success of our families.

Larry Kromann, President

Calistoga Affordable Housing

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