Calistoga council debates use of Measure D housing funds; asks staff to study options

The Calistoga City Council on March 18 discussed how to use Measure D revenue — a 1 percent transient-occupancy-tax (TOT) surcharge dedicated to housing programs — and asked staff to return with options for both new projects and preservation programs.

Measure D funds currently total about $2,400,000, and staff told the council the account is accruing at roughly $1 million per year under current conditions. Director Desmond said the funds are eligible for a wide range of housing programs and recalled previous council direction to explore the Earl and Eddy site and a partnership with the school district for affordable or workforce housing.

Why it matters: Council members said the city’s top priority after public safety is increasing “missing middle” housing — units the local workforce might afford. Several members signaled interest in using Measure D to support both new construction and programs that preserve or improve affordability for existing residents.

Discussion and direction: Councilmember Eisenberg said Earl and Eddy and the school-district partnership should be top priorities because they could produce housing affordable to city employees, teachers and merchants. Councilmember Gift urged hiring a housing-focused staff person within Planning to shepherd multiple efforts, including rezoning and incentive programs. Director Desmond confirmed that Earl and Eddy could not be funded solely from the current balance and that prior project estimates (from a 2020 review) suggested subsidy needs beyond current Measure D funds. He said staff has met with the school district’s design team to seek a more feasible joint approach.

Council also raised preservation uses for Measure D: Vice Mayor Lopez Ortega and other members noted past programs that provided repairs and accessibility work for mobile-home residents and urged staff to investigate whether a similar program could be restored or relaunched. Director Desmond said some similar efforts historically used Community Development Block Grant (CDBG) funds and required a dedicated program manager; he said Measure D could be used directly for locally run repair or preservation programs if council wished.

Other follow-up items the council asked staff to research and return with recommendations: - A staffing analysis and job design for a housing-focused planner or program manager (possible use of Measure D to fund the position or partial funding); - A framework for a homeowner/repair program for low-income/mobile-home residents, including whether a preexisting program or partner (Calistoga Affordable Housing / local nonprofit contacts such as Erica Clark were discussed) can be reactivated; - Whether Measure D funds could legally be deployed to subsidize utility/water bills for qualifying households (Director Desmond noted legal review and income-eligibility definitions would be required and that the program should be tied to preserving housing); - Continued negotiations and feasibility work on combining the Earl and Eddy site with school-district opportunities; and - A proposal for earmarking policy (e.g., how much to hold as reserve vs. commit to projects).

The council did not adopt a final funding decision at the meeting; instead, it provided the staff direction above and asked for return reports and proposals with cost estimates and legal analysis.

Ending: Director Desmond said he would bring additional details to an April meeting, including a higher-level analysis of potential rezonings and staffing needs, and will report back on school-district conversations.