Mar 12, 2014

The Winery Glut

Update 10/7/15
At the Oct 7, 2015 Planning Commission meeting Dir. Morrison presented his latest number crunching on grape harvest, actual wine production and permitted production capacity in the county. The 2014 grape crop was enough for 21 mil gallons of pure Napa wine. As in his previous presentations, only about 18 mil gallons of capacity is currently required to be Napa grapes. Legally he feels that the county is required to allow that additional 3 mil gallons to be permitted in new wineries or winery expansions. The reality is that all Napa grapes are being processed and there is a portion of the Napa grape crop, probably much more than 3 mil gallons, that is now being processed by Napa wineries not required to do so. And the reality is that most of those wineries are unlikely to give up their Napa grape sources. The question is still why keep permitting new and unnecessary wineries and additional capacity, as long as there is already an existing demand for the whole of the Napa crop? The Farm Bureau's Norma Tofanelli dissects some of these numbers here.

Update 9/1/15
At the Aug 11th BOS meeting, Planning Director David Morrison gave the board a presentation on code enforcement and compliance issues (item 9B on the agenda) which included a summary of the tentative provisions of proposal Z unanimously approved at the APAC July 27th meeting. As part of his powerpoint presentation to the Board he included some grape crush statistics based on information received from the TTB which illuminated changes in Napa grape crushing over the years. Three graphs stood out: the number of Napa grapes crushed outside of Napa county has gone from 11% to 26% of the total harvest since 1991. Napa grapes have gone from 67% to 31% of the total grapes crushed in the county since 1991. There is an increase of 27% in Napa grown grapes and an increase of 124% in total grapes crushed since 1991. What is to be made of these numbers? Only that the amount of non-Napa wine being produced in the county is expanding (principally around the airport) while the amount of Napa wine remains somewhat fixed, based on the slow growth of new Napa vineyards.

Update 3/11/15
Planning Director Morrison produced his own numbers (page 32) at the Mar 10th 2015 joint Bos/Pc meeting. His conclusion: 28 mil gallons of wine are produced from napa grapes. Only 18 mil gallons of capacity has been added since 1990 that is required to use napa grapes. There are 118 mil gallons of capacity in the county not required to be from Napa grapes, but 10 mil gallons of which is now being used to process Napa grapes. His implicit and uncomfortable conclusion: Pre-WDO wineries have the right to shift all their pre-WDO production to central valley grapes. And the county has the obligation to approve another 192 more 50,000 gal wineries.


    "Are we at capacity?... Is there justification to continue building wineries in this valley?"
      -- County Supervisor Mark Luce, 2015

At the joint meeting of the BOS and the Planning Commission on May 20th 2014, the above question was asked by Supervisor Luce to the planning director. It was a monumental question, as much at the heart of the new winery debate as tourism. The planning department has given itself until October to come up with the answer.

While the county may take months, I'm willing to take a stab at it now, because like many other NIMBY's across the county I am facing the brunt of bad planning decisions right now. Projects currently proposed may be cast in concrete by the time October comes around - I can't afford to wait. I preface this by saying that I have no expertise to bring to this analysis and having just begun to look at these issues since finding our about my winery in March, have no insight into the complexity of the issues involved. I will anticipate being labeled a fool (or worse) by people who do have expertise in the area.

As it turns out, Supervisor Luce's question was posed to the planning department in 2012 leading to this staff report presented during this planning commission hearing.

The actual question was:
“1. What are the policy implications if the County has approved enough wineries subject to the 75% rule that the wineries (at maximum production) could use up all of the fruit that is grown in Napa County?"

The 75% rule was created in the WDO of 1990 and requires all capacity created after 1990, new wineries and expansion of existing wineries, to use a minimum of 75% Napa grown grapes.

Based on the staff report graph, the total county permitted capacity of 118,600,000 gals/yr in 2012 would seem to be about 4 times the amount needed to process, according the crop report of 2012, the 29,000,000 gals worth of 75-25% napa wine produced that year. But much of that capacity is exempt from the 75% rule: 26 million g/y of pre 1990 AP/AW capacity is exempt, as are wineries outside of the AP/AW zone (the Bronco winery at the airport is permitted 43,000,000 g/y, one third of all permitted capacity in Napa county).

Only 36 million g/y (the increase in production in the AP/AW zone since 1990 on the chart) is mandated to use napa grapes. That is still much more than the 29 million gallons of 75-25 blend capable of being produced from the 2012 crop. Enough new capacity has been permitted since 1990 to process all napa grapes and then some. But adding to that capacity is that many new wineries use 100% napa grapes and also that much of the 26 million g/y being produced before 1990 was from Napa grapes and it is unlikely that all or even most of that processing has shifted to non-napa grapes. Unfortunately the complexities of tracking pre-WDO wineries ability to shift Napa grapes in and out of their old facilitates makes an estimate of that capacity difficult.

The staff conclusion, perhaps understandable given the conflicting goals of the industry “stakeholders” participating in the review, was that the status quo need not be challenged at this point.

But the staff did produce a statistic of interest in the report: reviewing the Commission hearing agendas (as I did for my winery tourism page) they concluded that 5-7 million gals/yr of capacity subject to the 75% rule were added between 2007 and 2012. (The exact number is difficult to determine because of the source-shifting abilities of pre-WDO wineries.)

But based on the County's crop reports, between 2006 and 2015 the acreage producing Napa grapes has hardly changed. In that same period almost 6 million gallons of new winemaking capacity have been approved in the county,

So while capacity has dramatically increased, no doubt based on the presumed profitability of winery-tourism, the acres of grapes added, whether because of the drought, a turndown in the economy, more concern about water availability, more neighborhood activism, or the previous development of all the easy watershed land, the rate of new vineyard production has leveled off.

The answer to Supervisor Luce's question? It is clear that the permitted capacity within county wineries has exceeded that necessary to process Napa grapes. Given the new-capacity-to-new-vine ratio over the last several years that will remain true for years to come. Whether this reality is hidden or convoluted because a faction wants to maximize the processing of more profitable non-Napa grapes, or because development profiteers want to promote the construction of more tourism facilities, doesn’t change that reality. Adding new capacity (and new land grabbing winery facilities) results in a shift of production (and tourist dollars) from one winery to another resulting in loss of land and resources with great benefit to development interests but little benefit or some actual loss to the agricultural viability of the County.

My policy implication: Stop building new wineries and expanding old ones. If the capacity is there, then rather than approving new wineries and expansions that use up vineyard land being built solely to attract tourists that will further strain the land and water resources of the county (and the peace-of-mind of residents like me), the County should begin to look at the incentives that will encourage wineries with unused or non-Napa capacities to fill that capacity with the fruit of new Napa vineyards.

Another approach would be for the County to begin auctioning new capacity based on the new acreage coming into production each year. Or perhaps the developers of new vineyards would have the option to sell the new capacity their vines would allow. This approach means that a market would be created in new production capacity which, for those believing in market based solutions, might be a good thing. Developers would have an incentive to turn unused or brownfield properties into vineyards.

It does also mean that more pressure would be felt to increase the creation of new acreage, which in turn raises the question of availability of water to supply the new wines and the effect of more water extraction on the aquifer as a whole in an age of global warming. That, of course, is another story.

8/11/17: Pattern and practice of failing to comply with CEQA re winery approvals
The Wine Institute statistics page
Map and Tables of use permits approved or still in planning dept since 2010
Planning Dept's 7/1/15 statistical analysis of permitted visitation and capacity
District 4 Historical Grape Crush Data
County Winery Database chart
Winery Audit Results 2013
Winery Audit Results 2012
Winery Audit Results 2011
Staff Report on Capacity 2013
PC Hearing on Capacity
Winery Capactiy Chart 2012
County Crop Reports
Economic Impact of Wine and Grapes 2012
My own capacity tables for projects approved since 2010

Ross Workman LTE 10/6/17: What do we want to protect?
NVR 8/14/17: Winery appeals stacking up before Napa County Board of Supervisors
NVR 7/8/17: Napa County eyes streamlining approval process for smaller wineries
NVR Editors 1/26/13: Our View: Winery ordinance powder keg needs defusing
NVR 1/26/13: Grape source rules divide wine industry


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When does the County look at cumulative impacts?

Bill Hocker - Oct 4, 2017 5:13PM  Share #1582

At the Oct 4th 2017 Planning Commission meeting, Comm. Cottrell asked Dir. Morrison once again about the evaluation of the cumulative impacts of all of these projects that they are approving and why those cumulative impacts are never considered as part of the discussion in individual projects, a question her previous colleague, Heather Phillips, was also quite concerned about.

As long as the cumulative quantities (of wineries, acerage, housing or jobs) aren't pushed beyond the predictions of the 2008 General Plan EIR there is no need he responded. Individual projects are evaluated only for localized impacts.

Interpreting the complexity of the EIR is not an easy process, involving as it did evaluating some 7 alternatives, bits and pieces of each making it into the final General Plan. This "Preferred Alternative" document seems to come as close as anything to summarizing the chosen bits. Under "Vineyard Development and Agricultural Processing" (p. 2.0-9) 225 new wineries are anticipated between 2005 and 2030, 9 per year very close to the reality thus far. The number was probably arrived at as an extension of the previous pattern. While the average capacity of each winery was assumed to be 50,000, the amount of visitation per winery, i.e. impact in the growth of the tourism industry, was never specified. Marketing, i.e. tourism, is hardly mentioned in the EIR beyond references to the WDO. In a meeting some time ago Dir Morrison indicated that while the number of wineries approved was in line with predictions, the amount of visitation requested in the last so many years had well exceeded historical requests.

Dir Morrison implied in his response to Comm. Cottrell that localized and cumulative impacts were exclusive. In the wording of the Preferred Alternative document the distinction is a bit more ambiguous: "As with vineyards, localized impacts – both project-specific and cumulative – would still require careful review when specific projects are proposed." How far into the future or how far from the project are localized cumulative impacts to be looked at before they are no longer localized?

Appealing for Responsible Governance

Bill Hocker - Sep 5, 2017 3:02PM  Share #1558

Update 9/5/17
NVR 9/5/17: Napa County defends its winery review records, asks mystery group to identify itself

NVR 9/3/17: Mystery group challenges Napa's winery environmental reviews

Alliance for Responsible Governance Letter
County Response to the Letter

In Director Morrison's response to the Shute Mihaly letter he basically highlights the problem with the 2008 General Plan and with the county's governance in its approval of new and expanded wineries. First, because the EIR recognized that there would be significant unmitigated impacts to the agenda promoted by the writers of the General Plan, so what if new projects are creating environmental impacts, it's all legal. Those writers, representatives of stakeholders in the wine industry, accepted the impacts because there was development money to be made in the Plan's projections. Now that the impacts are upon us, residents and perhaps even some stakeholders, have become very concerned about the resultant reality of the devil's bargain.

Second, he tries to portray the winery approval process as only being about the number of winery permits being given and the production capacity of those wineries, both within the limits quantified in the 2008 EIR. But it is the amount of visitation being approved as the wine industry morphs from agricultural production to more profitable winery tourism that was not quantified in the EIR and hence not vetted under CEQA. And it is the embrace of tourism by the wine industry that is driving the resistance to winery approvals and to the pushback on winery compliance. Yet "tourism" is a word barely mentioned in county discussions. Complaining about the "wine industry" is caged as an attack on "agriculture".

There is no question that tourism is beginning to have significant impacts on the "agricultural lands and rural character" that the General Plan claims to protect. Yet the county continues to pretend that 40% of winery square footage devoted to tourism, or a consultant's manipulation of atomized traffic, noise or water statistics will result in less-than-significant impacts. Despite the 4300 acres of vineyard approvals, the total producing acreage of vines, and hence the total amount of Napa wine that can be produced, has hardly risen in the last decade. The reality is that most of the new and expanded wineries are not necessary or economical as processing facilities and would not even be proposed without their tourism component. Tourism is not incidental and subordinate to the decision to propose a project, but the reason for the proposal. And the impacts of that tourism are not less-than-significant.

The promotion of tourism is a much greater problem than just the proposal of event center wineries, and the municipalities need to recognize that their lust for the tourist dollar is also a threat to the character that makes this a desirable place for tourists and residents alike. But the county needs to confront the problem where it can. The county and the wine industry need to acknowledge that tourism is not agriculture, and that the urbanization that tourism brings is a threat to lose in the next generation the agricultural economy and rural environment that previous county governments fought so hard to maintain.

Residents, who have had to lead the resistance to the rise of a tourism based economy in Napa county, can only hope that the creation of the "Alliance for Responsible Governance" is a sign that some in the wine industry are willing to recognize the threat that Napa's ongoing urban development is beginning to pose to the survival of their own agriculture-based industry and are finally willing, whether anonymously or not, to say so.

NVR 8/14/17: Winery appeals stacking up before Napa County Board of Supervisors

The impact of tourism on the residents of Napa County, and the traffic increase and loss of affordable housing that is its most obvious result, has begun to receive pushback in a number of ways in the last three years. The resistance that initially began as opposition to projects coming before the Planning Commission has now progressed into the Supvisiorial realm with appeals to planning commission decisions now becoming routine where they were once exceptional. The number articles and letters to the editor now related to outrage over the number of wineries being approved and the impacts they contribute to, like the appeals, are beginning to stack up. As are questions about how carefully the EIR to the 2008 update of the Napa County General Plan analyzed the impacts of increasing tourism brought about by its changed policies.

A letter to the Napa Board of Supervisors by attorneys Ellison Folk and Perl Permutter of the law firm of Shute, Mihaly & Weinberger, has stated the case that County Government has neglected to adhere to CEQA requirements by inadequately assessing cumulative impacts in its ongoing approval of winery projects each month:
Pattern and Practice of failing to Comply with CEQA regarding Winery Approvals

The EIR Archive for the 2008 General Plan is here
NV2050 on the Perlmuter letter: When Governing Powers go Rogue.

And now, a significant court decision to a case brought by attorney Jerry Bernhaut in Sonoma has stressed that GHG's generated by the full extent of winery and tourism activity into and out of Sonoma County has not been properly considered under CEQA in the development of their Climate Action Plan and that alternatives to this form of activity have not been evaluated.

Wine and Water Watch 7/28/17: Judge Rules Climate Action 2020 Plan Violates CEQA
The case is here: California Riverwatch vs. Sonoma County, et al.

In each case county general plans and ordinances sanction development projects that the governments contend have less-than-significance impacts on the environment. The environmental impacts felt by residents in the realization of these projects has not, however, been less than significant. And residents are questioning, more and more how those less-than-significant determinations are made, through comments at hearings and in the press, and in appeals to decisions made by governmental bodies, and finally in court challenges to the governmental processes that allow such significant impacts to occur. It is no longer enough for counties to pretend that impacts are less-than-significant because they say they are. The impacts are just too obvious.

County proposes winery fast-track

Bill Hocker - Aug 11, 2017 3:14PM  Share #1536

Update 11/5/17
Eve Kahn sent along this update on the decision to table the ordinance:
"David Morrison was reviewing staff priorities with the board in late Sept and when Limited Winery Ordinance was discussed the board opted to table it to an unknown date. Diane felt that this was a solution looking for a problem - and was definitely not what she expected or wanted to see.

SO - bottom line, between given a low priority prior to the firestorm and more pressing issues at hand - this one is off the radar for now."

Update 8/14/17
NVR 8/14/17: Obscure Napa County position may play a bigger winery growth role

Update 8/11/17
[In response to questions from Chris Malan, Planning Dir. David Morrison elaborated on the process that the Limited Winery Ordinance will endure through the county meat grinder]

    Date: August 11, 2017 at 6:14 AM! PDT


    Thank you for the inquiry.

    No, a CEQA document has not been prepared as of yet. This comment period is solely to obtain public input and concerns regarding the proposed ordinance.

    After the additional 45-day review period has been completed, staff will revise the draft ordinance, incorporating public comments where appropriate. The revised draft ordinance will then be used as the project for preparing a CEQA document, which will have a separate public comment period. In addition, the public will have opportunities to comment at public hearings before both the Planning Commission and the Board of Supervisors.

    I hope you find this helpful in clarifying the status of the current review period. If you have any further questions, please let me know.



NVR 7/8/17: Napa County eyes streamlining approval process for smaller wineries

Proposed Limited Winery Ordinance
Dir. Morrison's request for comments.
Local Procedures for Implementing CEQA (CEQA sm. winery def. see appendix B, #10)

What can one say? The County is issuing use permits for new wineries at the rate of one a month (and increases to existing wineries at two per month) even with Planning Commission review. Apparently that is still not fast enough to keep up with developer's desire to profit from an expanding tourism economy and booming real estate market. The County wants to streamline the process, providing an easier avenue for speculators to increase resale value with "winery-ready" properties. Not one more gallon of Napa wine will be added to the county's "wine industry" (producing acreage hasn't budged in the last 10 years despite some 100 new winery approvals), just more luxury estates and tourism venues. This is not about affordable small "family" wineries. It's about expediting a real estate strategy targeting wealthy vanity investors.

One can see the problem from the County's standpoint: The amount of pushback from citizens who will be negatively impacted by all of the proposed development is bogging down a process whose purpose is to allow public participation. The solution proposed is to reduce the visibility and amount of public input in the process.

The Planning Commission is a public event. Its meetings are predictable and previewed on the county's website and in the Register. Its proceedings are broadcast and a video archive is retained. The county claims that the public will have a similar opportunity to vet projects being presented to the Zoning Administrator. But notification will only go to residents within 1000' of the project. No previews in a public calendar. And likely no mention in the Register. It will then be up to a neighbor to make the project known to a wider audience, a daunting task for some. Once the hearing is done, no record beyond brief meeting minutes will be available for review. But the collective changes that these projects bring, with increased tourism throughout the remote areas of the county and the expansion of taxpayer-funded infrastructure to accommodate an ever increasing number of tourists and employees, will affect the county as a whole, not just the immediate neighbors.

As a recent article on Visit Napa Valley highlights, county and municipal governments seem to see a "growth" economy based on tourism as the prime objective of planning decisions. As we have seen in all meetings throughout the last few years, the county is unwilling to seriously consider the increasing cumulative impacts of growth that have led to so much citizent opposition. In this proposal, conceding to the demands of the development industries, they wish to make the opposition more difficult.

The County's continued promotion of building projects and the resulting impacts on traffic, affordable housing, community character, infrastructure and service demands, the physical landscape and resource sustainability, run counter to the County's stated image of itself in the first paragraph of its Vision Statement in the Napa County General Plan:

    "While other Bay Area counties have experienced unprecedented development and urban infrastructure expansion over the last four decades, Napa County’s citizens have conscientiously preserved the agricultural lands and rural character that we treasure."

Many county residents, seeing the urbanization taking place before their eyes, no longer feel that vision is being supported by their government, and they should be allowed to conscientiously make their voices heard. In a public forum.

The question the County should be addressing is not how the approval of building projects can be streamlined to increase the pace of urban development. The question should be how to scale back the amount of development being proposed, as previous governments and citizens have done with the Ag Preserve, zoning ordinances and initiatives, to insure that Napa remains a rural, agricultural place to be treasured in the future. Fast-tracking building projects (much like pretending that building projects are "agriculture") is not the answer.

7/29/17 LTE version: Fast tracking Napa County wineries isn't the answer

NVR 10/2/15: Planners look at fast-tracking small wineries

Note the difference between the 2015 and the current proposal: the requirement that grapes must come from the property has been eliminated. Wineries can be approved under the new proposal on properties having no vineyard potential (like The Caves); a lease on grapes (currently leased by someone else, no doubt) suffices. There is no mention of use-permit revocation in the ordinance, so presumably the lease may be sold as soon as the winery is approved.

George Caloyannidis - Jul 10, 2017 7:50PM

[Comment submission to Dir. Morrison re limited winery ordinance]

Dear David,

Attached is my revised comment on the Limited Winery Ordinance.
I revised Section "H" with a calculation of visitors this Ordinance would permit which is so staggering that one has to indeed wonder what thought if any is behind it.


Small Winery Ordinance Comment

And Divid Morrison's response:

From: Morrison, David []
Sent: Wednesday, August 02, 2017 1:14 AM


With all due respect, I strongly disagree with several of the statements made in your letter.

A. There is a policy reason for the draft ordinance. It says so in the third paragraph of the ordinance recitals, where it states: “Action Item AG/LU-16.1 directs that consideration be given to amendments to the Zoning Ordinance that define “small wineries,” a “small quantity of wine,” “small marketing events,” and “mostly grown on site,” and establishes a streamlined permitting process for small wineries which retains the requirement for a use permit when the winery is in proximity to urban areas. In turn, the Action Item implements Policy AG/LU-16, which states:

In recognition of their limited impacts, the County will consider affording small wineries a streamlined permitting process. For purposes of this policy, small wineries are those that produce a small quantity of wine using grapes mostly grown on site and host a limited number of small marketing events each year.

The County’s intent and purpose in considering this ordinance is clear. It is to amend the County Code and create a simpler permit review process that reflects the limited impacts of smaller wineries. You may not agree with the policy, but the basis for this action does not require any surmise.

I would also point out that the proposed ordinance does not minimize either public scrutiny or the CEQA process. Applications considered under the draft ordinance would still be subject to CEQA review. They may obtain a Categorical Exemption, if they qualify, as they may currently do under the adopted Local CEQA Guidelines. If they do not qualify for a Cat Ex, then a Negative Declaration, Mitigated Negative Declaration, or EIR will be prepared, as is appropriate. The draft ordinance would not change CEQA review in any way. Similarly, applications under the draft ordinance would still be noticed to all neighboring property owners within 1,000 feet of the project, still be noticed in the newspaper, and would be considered in a public hearing, where interested parties may testify, and any resulting decision may be appealed to the Board of Supervisors. The draft ordinance would not minimize public scrutiny in any way.

B. There appears to be a misunderstanding. The provisions of the draft ordinance would be available to all wineries that meet the qualifying criteria, whether they are newly established or are already established and want to modify their existing use permit within the constraints of the definition of a limited winery. To do otherwise, would create an unfair advantage for one class of business over another.

C. Why is 30,000 gallons considered a small (or in this case limited) winery? Because that is how they are defined in Napa County’s Local Procedures for Implementing CEQA. Appendix B, Class 3, Subsection 10 states:

Construction and operation of small wineries, other agricultural processing facilities, and farm management uses that:
(a) are less than 5,000 square feet in size excluding caves;
(b) will involve either no cave excavation, or excavation sufficient to create no more than 5,000 additional square feet with all of the excavated cave spoils to be used on site;
(c) will produce 30,000 gallons or less per year;
(d) will generate less than 40 vehicle trips per day and 5 peak hour trips except on those days when marketing events are taking place;
(e) will hold no more than 10 marketing events per year, each with no more than 30 attendees, except for one wine auction event with up to 100 persons in attendance; AND
(f) will hold no temporary events.

As for national metrics, wine economists generally categorize wineries as follows:

Large – 500,000 cases and up (1,2 million gallons)
Medium – 50,000 cases to 500,000 cases (120,000 – 1.2 million gallons)
Small – 5,000 cases to 50,000 cases (12,000 – 120,000 gallons)
Very Small – 1,000 cases to 5,000 cases (2,400 – 12,000 gallons)
Limited – less than 1,000 cases (under 2,400 gallons)

By this standard also, 30,000 gallons is considered a small winery.

D. The focus of the draft ordinance is to provide some relief to small and family-owned businesses. If there are many such businesses, should they be denied relief simply because of their number, or should policy instead be based on their circumstances?

For clarification sake, about 1/3 of the wineries listed on the Napa County database would fall within the criteria of the draft ordinance. While there are more wineries that produce under 30,000 gallons, about 70 of those wineries have buildings, caves, visitation levels, or marketing events that exceed the definition of a “limited winery.”

E. I don’t agree that there is a contradiction. If wineries were to take advantage of the draft ordinance (should it be adopted) to increase production to 30,000 gallons, they would still be small wineries. There is only a contradiction if you define a small winery as having much lower production. I do not share that perspective.

F. Once again, I have to disagree. The cumulative impacts of winery development was already evaluated in the General Plan EIR, which was certified in 2008. Each winery permitted under the draft ordinance would undergo appropriate project-specific CEQA review. The draft ordinance does not allow any additional winery development not already anticipated in the General Plan. In fact, as stated previously, the draft ordinance is a direct implementation of the General Plan. Additional cumulative CEQA review of the draft ordinance is not required, in my opinion.

G. See F above.

H. See F above.

I. With regards to justifying the consideration of the draft ordinance, that was part of the policy debate regarding the General Plan in 2008. The purpose of the General Plan is to provide a set of policies under which the County would operate over the following 25 years. That is why adopting comprehensive General Plan updates is such a lengthy and expensive process. If you believe that circumstances have changed since 2008, you may want to request that the Board amend the General Plan to delete Policy AG/LU-16. Again, you may not agree with the idea, but an adopted policy carries significant legal weight.

If you are suggesting that the production level for limited wineries in the draft ordinance could be reduced to 15,000 or 20,000 gallons annually, I agree. The 30,000 gallon criterion was initially offered as a starting point for public discussion, but one that was consistent with the adopted Local CEQA Guidelines. Others have also suggested a lower threshold. The Planning Commission or Board of Supervisors are free to use an alternate metric.

J. Once again, I have to disagree. Length of time in permit review does not necessarily equate to public benefit. Staff is required to follow State law, which includes the Permit Streamlining Act. There is a balance between the exercise of private property rights and public interest. This ordinance would continue to provide full public review and participation for the review of development applications.

The draft ordinance would not permit any greater level of winery development than is already allowed under the General Plan, which evaluated the cumulative impacts of winery and vineyard development between 2005 and 2030. As this ordinance would not increase that potential, further cumulative analysis is not required.

The Zoning Administrator would not become a “winery czar,” any more than the Planning Commission could be described as such. The Zoning Administrator currently makes decisions regarding Use Permit Modifications, Variances, Certificates of Non-Conformance, and other applications. This would be similar to the Administrator’s existing duties. The Administrator’s decisions may be appealed to the Board of Supervisors, who ultimately is responsible for setting policy in the County.

As always, I am happy to discuss these issues and welcome constructive dialogue towards developing a better draft ordinance.

Thank you for you comments.



And George Caloyannidis' response

Sent: Wednesday, August 02, 2017 11:37 AM
To: 'Morrison, David'

Thank you David.

Your statements are technically correct as they reflect the provisions of the Ordinance which are already known. However, they neither refute or specifically address mine because by their nature, they try to show the shortcomings of the Ordinance. Specifically, your statements do not provide answers to the points I presented.

· They do not explain the rationale for the need of the Ordinance other than to make things easier for applicants.

· They do not explain by what standard (or reason) a 30,000 gallon production winery is a new "small" one when 52% of all existing wineries in the county produce less.

· They fail to explain why potential quantifying data have not been presented to the Planning Commission.

· They do not explain why potential impacts of the Ordinance have not been presented to the Planning Commission or even a suggestion by staff that there may be worthy of consideration.

· They fail to explain which specific provisions of the Ordinance are the ones which facilitates its "streamlining". What specifically has been eliminated from the current process and what is its downside?

Maintaining that the Administrator's decisions may still be appealed to the BOS is correct but let's stop trying to hide the fact that it facilitates a process by which many of his/hers decisions will occur under the public's radar. Unless you can explain otherwise, this is the main instrument behind the "streamlining" of the process.

The 1,000 foot notification radius is grossly insufficient. Has staff tried to put the adequacy of such radius into perspective? For example, how many property owners would be notified if some of the randomly selected wineries below would apply?

Colgin (20,000)
Dalla Valle (20,000)
Diamond Mountain (10,000)
Kongsgaard (12,000)
Mayacamas (5,000)
Saddleback (8,000)
Signorello (20,000)
Titus (25,000)

Does Staff seriously believe that a 1,000 foot radius is sufficient to serve the public interest? Or does this number prove my point?

But the main concerns is the roundabout way by which this Ordinance will have advanced the Napa county CEQA baseline (traffic, water etc.) without CEQA review.

Your response does not address how an Ordinance which has the potential to incrementally add 3,564,277 gallons of production to the EXISTING "small" wineries, add 7,931 acres of vineyards plus 3,248,628 annual visitors is not cause for alarm meriting responsible environmental review. Mind you, this does NOT include special event visits NOR the impacts of NEW "small" winery streamlined applications, the number of which staff has also failed to make a credible effort to quantify.

These are massive numbers with potentially profound cumulative impacts - none of which were presented to the Planning Commission or the BOS for consideration - but obvious to any thinking person. They are so obvious that it is hard to hide the agenda driving this Ordinance by disingenuously hiding it under the innocent clothing of "SMALL".


PS: When will the Ordinance be heard by the BOS?

Love the small wineries?

George Caloyannidis - Jul 18, 2017 7:51PM  Share #1546

If a municipality wanted to preserve the ambiance of a single-family neighborhood, it wouldn't rezone it to residential high-rise. Over a short period of time, homeowners would sell to developers at a profit and the area would experience a fundamental transformation.

In Napa County, whenever a small winery pleads hardship, officials accommodate it with higher use permit limits of production and visitations. They say: "We all love small wineries. We must do everything to support them." Who can possibly argue with that?

But there is a problem. Even when wineries have been operating in gross violation of their use permits, their plea for survival becomes their passport to riches. Just like that, even without proof of hardship, the value of the winery is often doubled and tripled and sold within weeks.

Further proof of how this policy incentivizes small wineries to disappear from the supposedly intended idyllic landscape into big investor portfolios, is the current rampant winery consolidation activity, all fueled by the county's policies marketed by its disingenuous rhetoric as compared to its actions.

I often visit the northern foothills of the German Alps, dotted with small towns, forests and meadows where a dozen or so cows of small dairy farmers graze. These farmers make a living with milk, cheese, honey and schnapps. They are prohibited from increasing their grazing lands by clear-cutting their forests, a long view policy that provides them with a decent living but keeps the value of their holdings to levels not attractive enough to corporate takeovers.

Small farms are preserved in harmony with forests and crystal-clear streams. When visiting the region one is captivated by the agricultural serenity so beautifully preserved since 198 years ago, when it was memorialized in Beethoven's 6th symphony, so appropriately named: “The Pastorale.”

Meanwhile, the wine lobby myth our supervisors have bought into that wineries cannot make a living without direct sales has now mushroomed to 59 percent of total revenue and is fueling the market of runaway hotels and traffic congestion their drinking and merchandising tasting rooms generate.

Just over the Alps from Italy's Alto Adige to Sicily, from the Mediterranean to the Atlantic in Spain, from the Languedoc to the Loire in France, from Germany's Rhineland to Austria's Burgenland, the direct sales model even for the thousands of wineries producing fewer than 8,000 gallons is an aberration. Instead, one finds their wines around the globe from Los Angeles to New York, Paris and London. Such marketing takes hard work, but it is enough to provide a decent living generation after generation, not just for a decade or two and then off to the Riviera.

Making a decent living from a "small" winery in the Napa valley means Maseratis and Teslas in the garage, government-assisted denuded forests, soiled streams and clogged highways. Sadly, it is us in our state of Napathy who allow the damage. Instead of voting for the right candidates, we let them displace us with second homers and luxury commercial rents.

To top it all off, the supervisors are scheduled to hear a "limited winery" ordinance that will "streamline the process" of approving "new small and/or family-owned wineries" producing a staggering 30,000 gallons. In the process they will shut the public out the door by installing a wine Czar to dole out permits without environmental review or public hearings. The problem is that 261 of the county's 510 existing wineries - more than half of them - produce less than that, 209 of them produce fewer than 20,000 gallons and one quarter of them produce fewer than 15,000.

Traditionally, existing wineries have enjoyed more, not fewer privileges than new ones. No one in the right mind believes the county's smoke screen that new wineries will enjoy this privilege while old ones will be compelled to undergo full review. It is so patently unfair that the furry paws can no longer hide beneath grandma's dress.

Potentially, in excess of 2.5 million more visitors to existing tasting rooms could be added to the 3.5 million who visit us each year and 8,000 vineyard acres could replace forests in the process. This does not even include the un-quantified hundreds of potential new wineries - those supposedly covered by the ordinance -- waiting to join the gold rush.

Within a decade, this devious under-the-radar effort by the county will have replaced forest green with the only green it is beholden to and will have silenced the Napa Valley Pastorale once and for all.

NVR LTE version 7/18/17: Love the small wineries?

The winery glut selloff

Bill Hocker - May 3, 2017 5:00PM  Share #1491

Ross Workman NVR LTE 5/2/17: Sell the wine or sell the winery

Mr. Workman has crafted another of his insightful looks at the "wine industry" in Napa County. (I've begun to collect links to his LTE's here.) As an outsider to the mechanisms of the industry I have always been a bit nervous in voicing conclusions that seem obvious but don't seem to be shared or voiced by the industry. I'm glad that someone more connected with it seems to have the same concerns, especially when they are stated in such a clear and concise form.

Flynnville: what is an appropriate winery?

Bill Hocker - Apr 7, 2017 9:46PM  Share #1412

Update 10/3/17
NVR 9/30/17: Settlement ends dispute over proposed Flynnville winery near Calistoga

Update 4/14/17
NVR 4/7/17: Napa County approves a winery on an 'eyesore' Calistoga site
NVR 4/14/17: Napa County planners approve South Whitehall Lane winery

Update 2/19/17
NVR 2/19/17: Napa County Planning Commission delays winery decision amid flood concerns

The Flynnville proposal was continued just before lunch. Surprisingly, it was not to be the major time-consumer of the day. That honor fell to the tiny, 10000 gal/yr, no-visitation Whitehall Lane Winery, a proposal so modest that it was hard to imagine any controversy given the now weekly approval of multiple wineries at the planning commission. The difference? The project is surrounded by respected resident growers and winery owners who don't want another building project (particularly one done by a spec developer) in their neighborhood. Yes, many of the complaints revolved around the drainage issues of Bale Slough that flows through the site (just as the depletion of groundwater became an issue for a respected neighboring vintner on Flynnville.) But as we know, and as Comm. Scott mentioned earlier in the day, these battles must be fought on the technical, "fact-based", nitty gritty issues that can be reduced to numerical "standards" and CEQA subsections. They are not fought over the real and non-quantifiable concern that the ever proliferating building projects are destroying the rural character and way of life that residents, growers, vintners and weekenders alike all treasure. It is that visceral concern that (IMHO) brings forth the energy and money necessary for the fight. Technical problems can be negotiated with technical fixes and CEQA "mitigations". There is no mitigation for the loss of a treasured rural character and way of life.

One of the great disappointments in the ongoing proliferation of winery projects these last 3 years has been the unwillingness of growers and vintners to confront the urbanization of agricultural lands until the buildings are proposed in their own backyard. Growers and vintners ("people who don't normally come to speak to us" in Chair Gill's words) have a great deal more power in convincing county officials than other residents. By remaining quiet they are insuring that eventually their backyards will be filled with building projects, and the rural character of the county that they appreciate and that is their livelihood is sure to disappear. [The project was a continued]

NVR 2/15/17: Worried about size, Napa County delays proposed Calistoga winery
2/15/17 hearing agenda and documents

Napa County Planning Commissioners sent the Flynnville Winery proposal back to staff indicating that the "size and scale" of a winery of 60,000 gal/yr, 25 visitors and 15 employees/day located on Hwy 29 next to the Castello di Amorosa on a brownfield site was inappropriately large. A month and a half earlier 3 of those commissioners approved a winery of 100,000 gal/yr, 60 visitors and 19 employees/day 6 miles up a mountainous dead-end road in an area with virtually no previous tourism, on a site that a requires the removal of 10% of existing vineyards to accommodate the project. I don't disagree with their decision on Flynnville. I strenuously disagree with their decision on Mountain Peak.

Despite many proscriptions in the county's winery definition ordinance, there is no definition of appropriate capacity or visitation. County Planning Dir. Morrison attempted to reduce the arbitrariness with Proposal X in the APAC hearings last year tying both to parcel size, an idea pooh-poohed by the wine industry members and eventually shot down by the Supervisors. Applicants are free to propose capacity and visitation based on their "business plan" which itself is never scrutinized. Staff shows the commissioners comparable existing wineries with similar capacity to assess the appropriateness of visitation. There is no metric to assess the capacity. The grapes grown on the gerrymandered Flynnville site might be enough for 2500 gallons of 75% wine each year. 60,000 gal/yr is just an arbitrary number.

As shown in the county crop reports, the number of acres in vines in the county have not increased much since 2006. But some 6mil gallons of capacity have been approved in that same period. At present all new wineries and winery expansions in the county will have to poach grape sources already used to make wine elsewhere, merely shifting the location of grape processing. Winery capacity, a permanent entitlement that "goes with the land" is often justified on the basis of grape contracts that developers claim to have. Those contracts may have been owned by someone else in the previous year and can be bought by another (desperate) new winery developer before this winery is even built.

The capacity and visitation decisions are left to individual commissioners' sense of appropriateness. (They are given the discretion to deny a project as well but have done so in only one previous project - the original, over-the-top Flynnville proposal made in 2013.) The arbitrariness of their decisions often leaves one shaking one's head in despair as tourist venues continue to proliferate in the agricultural zones.

Most new projects and expansions are in fact being proposed simply to provide additional venues for wine tourism. Unfortunately the growth of the tourism industry has much different impacts on the environment than agricultural processing. By presenting the marketing and sales of wine ( i.e. tourism) as "agriculture" in the 2008 General Plan (policy AG/LU-2 on page 13 here), the analysis of the impacts of tourism development were conveniently avoided in the EIR leading to 2008 General Plan adoption.

A wine-tourism economy has impacts. It inflates rural land values and labor costs and urbanizes the rural environment, undermining the profitability of an agricultural product that must compete in a global market to exist. Winery tourism brings an ever increasing labor force into rural areas and an ever increasing number of tourists to be housed and fed and transported by ever more employees in the municipalities. It is a cascade of urban development impacts that we are already experiencing in traffic, loss of affordable housing, infrastructure taxes, natural resource degradation and the changing rural and small town character so important to us all.

The rejected 2013 Flynnville Wine Company project archive:
Hearing video
Hearing transcript
NVR 10/3/13: Updated: County planners reject Flynnville winery project

The winery glut

Bill Hocker - Dec 3, 2015 10:21AM  Share #1104

At the Nov 2nd, 2015 Planning Commission meeting, Planning Director Morrison presented a brief review of projects in the planning department pipeline. A total of 51 new or major mod winery applications are currently under review. He noted that at the normal rate of Planning Commission review getting through the 51 would take 3 years. Of course the normal processing rate has been slowed a bit in the last 2 years. As he also noted, more projects will continue to be added in that time - the pipeline has not been shut off. And, as new restrictions based on the APAC recommendations are being considered for implementation by the Board of Supervisors, a surge of applications to get in under a wire may be expected as well.

The number of plutocrats and personalities in the world wishing to have a winery of their own in the Napa Valley is probably much larger than the 4500 parcels in the county available for such projects. Few of these projects will add to the wine output of the county. They will only subdivide that output into ever smaller brands, harder to sell in the wholesale chain. These vanity vintners will continue to demand tourism for retail sales and to exhibit their good-life identity, a trend encouraged by an ever expanding tourism industry wanting venues to drive demand, heedless of the impacts that tourism development is having on the rural character of the county and its agriculture based economy.

Supervisor Luce has already intimated that it is time to consider a permanent moratorium on new wineries in the Ag Preserve. The planning department is receiving applications faster than they can process them, also a reason for a moratorium. The BOS is considering changes to the General Plan regarding wineries, another cause for a moratorium while the changes are made lest there is a surge of applications.

It is time for a moratorium on winery development.

More than a moritorium

Bill Hocker - Mar 24, 2015 7:37AM  Share #725

[letter to the editor in the Napa Valley Register, March 24th, 2015]

At the March 10 joint meeting of the Napa County Board of Supervisors and its Planning Commission, which began a months-long review of development issues facing the county, a very interesting statement was made by Supervisor Luce following Planning Director David Morrison’s statistical presentation on the county and the wine industry.

The supervisor recalled his role on the planning commission at the time the 1990 Winery Definition Ordinance (WDO) was formulated and recounted its original intent: to boost the capacity and increase the amount of Napa grapes processed in county. He compared the original intent to foster more capacity and compared it to the reverse situation now where there are several times the capacity to process grapes than there are grapes available. He stated that “The justification, frankly, for putting yet another new winery into our Ag resource area is much thinner than it has ever been in the past. And I think that we are really faced with a question of why should this be allowed to continue.”

He indicated that he didn’t have an answer to the question but, frankly, in posing the question he let his feelings be known. He had expressed the same question at the May 20, 2014, joint meeting, with the desire for more numbers from the planning director to provide guidance.

Director Morrison’s presentation here indicated that the current actual wine production in Napa County uses 2.43 times as many grapes as the total current Napa grape crop. The total permitted capacity (the theoretical amount of production currently allowed in the county) would be able to process 5.25 times the current total Napa grape crop.

At the end of his remarks, Supervisor Luce hedged a bit on the need for winery prohibition in the watersheds, but in doing so clarified his stand on their prohibition on the valley floor. (Given the overcapacity argument, I don’t quite see a distinction myself.)

One of the directions given to Director Morrison at the meeting was to set up an ad hoc committee to look at the current WDO and winery issues. The Agricultural Production Advisory Committee (APAC) is to be composed of 17 members from various county constituencies. One of its tasks is to look at what changes can be made in the current WDO to ensure the long-term sustainability of an agricultural economy that is not consumed by tourism. A series of issues were proposed to be looked at: minimum parcel size, estate grape requirement, no-vineyard-loss provision, separation of valley and watershed winery requirements, visitation limits, etc. All might be considered “tinkering” with the ordinance to control the number of new wineries, expansions and visitation going forward.

The firmest proposal to date, an increase of the minimum parcel size for a winery to 40 acres from the current 10, would mean that 2,400 new wineries might be developed in the future rather than the 4,500 currently possible.

What was not proposed was the option, raised by Supervisor Luce, to cease building and expanding wineries altogether. That option should be the first decision that APAC undertakes.

That Supervisor Luce’s proposal seems to have been unconsidered by the other supervisors and by the planning department indicates perhaps political or economic interests that I, as only a concerned citizen, am not privy to. But the supervisor is not naive about the political possibilities in the county, and his proposal is the only real suggestion made thus far to stop the development wave that continues to degrade the character and the substance of the rural, agricultural, small-town life that we all claim to cherish and is my reason to be here. That development wave will eventually bury the vines.

Supervisor Luce’s proposal is a first step to protect the vision of the Agricultural Preserve, made in 1968, for the next 50 years, and it needs a full discussion now.

Hocker lives in Napa.

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