The proposed Stream Setback Ordinance (SSO) will have serious financial consequences for every citizen of Napa County, including City residents.
According to John Tuteur, the Napa County Assessor's office has already reduced the assessed value of one parcel in Gordon Valley by $1.3 million due solely to the impact of this ordinance on its vineyard development potential. This is confirmation that expected property devaluations are real and significant. The ordinance has not even passed, yet some sales have already failed, and some prices have already been renegotiated downward, due to the anticipated impacts of the SSO. Buyers who have closed escrow not knowing of the impending ordinance are suing sellers to recover the decrease in value.
Planning staff estimates that 9,000 parcels will be impacted by the SSO. It will impact the potential for constructing a residence on each affected bare parcel, as well as the potential for expanding existing residences. It will impose restrictions on water wells, access roads, accessory buildings, fences, gardens, and a host of other residential accessory uses. It will also impact the vineyard development potential of undeveloped parcels and the expansion potential of existing vineyards.
Because rural parcels are often a mix of residential and agricultural uses, many so-called rural residential parcels will suffer a double impact. Vineyard development potential is an important amenity of rural residential property. Even a very small potential vineyard significantly enhances the desirability and value of any rural parcel. When that vineyard development potential is diminished, the value is diminished. Similarly, when the expansion potential of a home, or the potential to develop a swimming pool, tennis court, horse barn, or any other accessory use is diminished, so is the value.
In addition to unfairly penalizing rural property owners, these diminished property values directly impact County property tax receipts, thereby impacting every Napa County Citizen. The reduction in capital investment that would otherwise have been made in these rural properties to plant those newly forbidden vineyards or to build those newly forbidden homes or home expansions will also impact the local economy in terms of lost sales and lost sales tax.
Not every parcel will be reduced in value by $1.3 million like the Gordon Valley parcel was, but neither will every parcel escape with zero reduction in value. The average impact certainly lies somewhere between those numbers, but where? In the absence of a professional detailed financial impact study commissioned by the County, I have had to make my own estimate (based on reasonable assumptions which I will share with anyone who asks).
Reduction in property values $1.8 Billion total
Reduction in local sales (ignoring multiplier effect) $0.8 billion total
Reduction in property tax revenue $20 Million per year
Reduction in sales tax revenue $31 Million total
Administration & enforcement, legal expenses,
and removal of additional large woody debris $1.75 Million per year
Flood damage due to additional logjams $5 Million per year
Although we can quibble about the accuracy of my numbers, I believe I can demonstrate that they are not off by anything approaching an order of magnitude, so it is clear that we are talking about Billions of dollars, not just hundreds of millions. Although my estimate could be way too low, it clearly illustrates the need for a more accurate professional assessment of the anticipated financial damage before we implement this ordinance.
The Stream Setback Ordinance will have serious financial impacts on property owners, the local business community, and on the coming City and County budget crisis. All thinking citizens should demand that our County Supervisors thoroughly analyze and consider these impacts before proceeding with this ordinance.
George Bachich
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