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In a city where wine flows nearly as freely as water, Napa, California, is banking on a development along its namesake river to spur significant economic growth.
The Napa RiverLine, as the vast project is known, is in many ways the model for the latest community growth trends throughout the country. It incorporates preservation of nature and recreation areas while encouraging restaurants, retail, and hospitality venues to set up shop.
Beneath the surface are lessons other communities can admire and take inspiration from. Even prior to work beginning, the vision is drawing acclaim for the innovative economic approach supporting the initiative. Napa implemented an Enhanced Infrastructure Finance District, which is one of a variety of tax increment districts gaining popularity.
Plainly speaking, EIFDs and TIF districts create an ecosystem for infrastructure improvement, capital projects, and new developments designed to improve the quality of life among citizens. Importantly, EIFDs are not funded by a new tax but rather by capturing all or a portion of the future property tax increment revenue, notes the City of Napa on its website.
In a region as affluent as Napa, such future funds are extremely valuable even as the region attempts to address its affordable housing challenge through the RiverLine.
“We’re freeing up a bunch of land for development to create something quite unique and iconic for the city,” says Neal Harrison, economic development manager in the City of Napa.
Kosmont Companies, a real estate and economic development consultancy that assists primarily West Coast communities, has advised Napa on the process for bringing the RiverLine to fruition.
Ken K. Hira, president of Kosmont, is a fan of the project because it demonstrates the versatility communities should be adopting in today’s marketplace.
As indoor malls struggle amid anchor department stores’ financial challenges, a new era of experience-based retail has emerged. Consumers easily shop for clothes and commodities on their phones from the comfort of their home, notes Hira, adding that the pandemic accelerated shifts in retail. Communities that respond to new behaviors rather than pine for the past are the ones that will thrive, predicts Hira.
“It’s time to be flexible,” Hira says.
That starts by adapting definitions to meet modern times. If retail business can be conducted under the roofs of homes in a residential district with work-from-home options, it opens the door for local governments to revisit land zones, says Hira. Consequently, towns and cities can ease restrictive or overly prescriptive permitted uses that can effectively block future growth.
“The public sector can create zoning strategies to capture value created by the private sector,” says Hira. “Those zoning strategies include certain tools, and that’s where cities can use zoning as economic development currency, and they can leverage that currency to attract private investment.”
Blended-use developments are an example of capitalizing on new trends to offer a myriad of amenities within walking distance for residents. This can include communities building shopping and entertainment districts around youth or pro sports venues or building around natural amenities such as waterways. Open green space and safety are among the most treasured traits developments can offer, Hira adds.
The general idea is to evolve thinking from retail as traditional shopping to retail as an immersive experience with quality of life and health and wellness as major themes, says Hira.
“Today’s consumer prioritizes convenience and value,” he says. “The more you know about your consumer in your own city, and their demographics and their patterns in life, the better you can create a community for them. If you build those environments, they will come.”
Napa RiverTrail checks all the boxes in the city of 150,000 residents[1] that attracts 3.7 million visitors annually. Once completed, it will be a new district not just for travelers in town on weekends but also for locals whose business helps keep stores afloat throughout the week.
The project aims to add sustainability to the region by building guards against flooding, a growing concern as climate change produces more extreme weather. The Napa County Flood
Control & Water Conservation District is running that aspect of the operation.
With that safety measure in place, the city will add a 4.3-mile bicycle trail and new walkways similar to the New York Highline and Tampa Riverwalk. The Napa RiverLine Advisory Committee, composed of local business, nonprofit, and government leaders with a track record of advocating and developing catalytic projects for community benefit, was created to shape the retail and recreation offerings and assist with fundraising.
There is a separate advocacy group focused on river conservancy.
Harrison estimates the economic impact of the riverfront district will be in the hundreds of millions of dollars, all powered by the EIFD. It is expected to result in 15,930 jobs, house 13,000 residents, and create education and art opportunities.
“We want to see that growth,” he says.
The California Association for Local Economic Development is impressed, awarding Napa its award of excellence. It describes the RiverTrail as “a visionary initiative aimed at activating, connecting, and enhancing public access along the Napa River, transforming it into a dynamic community and economic asset.”
While the RiverTrail is certainly ambitious, it is not the only project to benefit from innovation in Napa. The city council recently approved plans on a $500 million project to build a luxury hotel, condos, and retail, on the site of a former Kohl’s in downtown.
“What they needed, and this is a problem in our downtown, is help with parking,” explains Harrison.
The hotel will be part of the city’s Tourism Improvement District, which collects taxes on guest stays to fund citywide projects.
The TID will be used to reimburse the developer with $33 million for a new parking deck, which will be a significant addition to the downtown experience, as Harrison stated.
Connecting the development to further growth is the implementation of a pedestrian walkway reaching into several shopping and dining areas, which is a growing trend in popular destinations.
Napa also hosts a variety of events, including a popular lights festival, to maintain downtown’s vitality, Harrison adds.
Hira notes that with the drop in mall business, there has been a resurgence in downtown shopping.
“Retail has come full circle,” he says. “We want to go downtown. We want to be in a walkable environment. And cities are creating these environments.”
