Appeal of San Francisco North Bay ‘granny flats’ grows, but challenges to build them remain

January 2, 2023 by Kathryn Reed for the North Bay Business Journal


Granny flats have evolved from makeshift additions for an older relative to live out her days to stylish dwellings that could win architectural and design awards.

No longer are these units inhabited just by a certain age group either. That’s because in addition to people constructing accessory dwelling units for family, they are being built as a revenue source for their owners.

Ash Notaney and Debbie Rossotti pivoted midstream as they were having an accessory dwelling unit built in Agua Caliente in unincorporated Sonoma County.

The full time San Francisco residents purchased the property in fall 2020 with the intention of building an ADU to accompany the 700-square-foot log cabin already on the acreage. The plan was for it to be a rental.

“We ended up falling in love with the building and this is going to be our forever house,” Notaney told the Journal. Before that can happen they need to get their children through school.

For now the nearly 1,000-square-foot two-story A-frame is being rented out to traveling nurses and the like — anyone who will stay 30 days or longer to satisfy county laws on short-term rentals.

The two-bedroom house has full bathrooms on each floor. It comes with a complete kitchen, spiral staircase and upgraded amenities. Rossotti did not share the cost of its construction. Notaney said through the process the Sonoma County planners were helpful in cutting the red tape.

“We landscaped the entire property and added a pool. There’s an outside sitting area and fire pit so there is shared space (for the two houses). The driveway can accommodate four cars side by side so each property could have two cars,” Notaney said.


Permit process needs help

In order to put a dent in California’s housing shortage, state and local lawmakers have eliminated a substantial amount of red tape to allow homeowners to build second residences on a property.

“New legislation made ADUs more attractive to homeowners because the application review process became more streamlined. ADUs are subject to ministerial review, have reduced building impact fees, reduced parking and setback requirements, and no longer require the owner-occupancy of sites until Jan. 1, 2025,” explained Erin Morris, Vacaville’s community development director.

The desire to encourage ADU construction throughout the state is being promoted as a way to combat the state’s escalating housing shortage.

“The state is seeing we need to streamline, and that we need to take bigger steps to get ADUs built as one piece of the housing solution,” Renee Schomp, director of Napa Sonoma ADU Center, said.

In the last 18 months the nonprofit has helped 550 homeowners in Sonoma and Napa counties start the ADU process.


Number of units is increasing

Nail by nail tweaking of building regulations is working. Local jurisdictions are seeing an uptick in ADU applications. In 2017, a state law mandated jurisdictions relax ADU requirements and many cities and counties followed suit with adopting their own ADU ordinances.

The spike ADUs In Santa Rosa Is not only the result the law change but the rebuilding after the Tubbs Fire that same year.

Prior to the Tubbs inferno, there were 26 ADUs in the Fountain Grove-Coffee Park neighborhoods. Since the fire 112 ADU permits have been issued for that area, with 61 finished, according to city spokesman Kevin King.

The city of Napa issued 26 ADU permits in 2021, while 33 have been issued in the first 10 months of this year.

San Rafael’s numbers are also going up. Alicia Giudice, community development director, said prior to 2018 the city approved about five ADUs a year. In 2018, 27 were granted, while between 2019-21 an average of 19 permits were issued each of those years. Through October this year 39 permits have been signed off.

In Marin County, from Jan. 1, 2020, through October 2022 there have been 173 ADU permits.

“We have never issued a denial letter or rejected a permit,” Manny Bereket, senior planner with the county’s Community Development Agency, told the Journal.

In the Napa Valley, Calistoga issued two ADU permits in 2019, one was built; in 2020 there were seven permits issued and one expired; 2021 saw eight permits and two completions; while this year through October eight more permits have been issued, with all of them in the process of being built, according to the Lauren Clark in the city’s Planning Division.


Problems and constraints

With a track record of home construction lagging population growth, California’s Statewide Housing Plan calls for an acceleration of new home construction over the next eight years with a target of 2.5 million homes. The plan breaks it down by the incomes of the prospective buyers:

  • 643,352 very-low-income homes
  • 384,910 low-income homes
  • 420, 814 moderate-income homes
  • 1,051,177 above-moderate-income homes

But even as the permitting process is getting easier and building limitations expanded, there are still obstacles — like cost.

“In speaking with various homeowners and potential applicants, the constraints are related to a steep rise in construction expenses in the past two years and fees associated with connection for water and wastewater. In some instances, applicants have told us that water and wastewater connection amount to $220,000. (Then there are) school district impact fees and lack of available qualified contractors,” Manny Bereket, senior planner with Marin County’s Community Development Agency, said. “More often than not, homeowners engage architects and contractors before conducting a complete feasibility analysis only to abandon the permits once they have been approved.”

Chris Craiker, president of Craiker Architects & Planners in Napa, is not convinced jurisdictions are doing all they can to expedite ADU permits.

“It’s still slow to get through cities and counties. Cities want them, but they make them tough to do,” Craiker said.

He noted some cities have water restrictions which make the units unattainable,

For instance, Sonoma County in October implemented a six-month ban on drilling new wells. And beginning next year all new construction in Marin County must be all electric.

“The intent originally was to create more workforce housing and housing for people working in the fields or in hospitality. I just don’t see that happening,” Craiker told the Journal.

That’s not to say his firm hasn’t been working on ADUs; about a half dozen such projects are in its portfolio this year.


Desire to build

Craiker may be correct about who is living in the ADUs. People are not building them strictly to have strangers pay rent.

Paul O’Rear started the ADU process at his Rincon Valley property in Santa Rosa in 2021 for his parents who both turned 90 this year. For now they are content where they are, so his daughter and son-in-law are living in the nearly 1,100-square-foot, two-bedroom, two-bath home.

Vaulted ceilings are in the living and kitchen area, with the latter having stone countertops.

“Water and sewer hook-up fees are less on an ADU than if you build a standalone house on a lot,” O’Rear said, though he didn’t disclose prices for the structure. “The overall cost of the project because of the times we are in were still outrageous, but we were determined to build now. The incremental cost to have nice finishings was well worth the expense.”

In the future O’Rear expects the dwelling to provide retirement income for him and his wife.

This ADU is one of four that Dustin Deason, owner of Brandywine Builders in Sebastopol, has under contract. Normally, he builds one or two a year.

“It’s one of the things that California is doing right to solve the housing crisis. Higher density has to be the solution,” Deason told the Journal.

Santa Rosa resident Mike Winter started the ADU process by seeking counsel from the Napa Sonoma ADU Center. As a retired contractor he better than most understood what he was about to undertake. Even so, a number of headaches ensued.

“We submitted our plan package on May 15, 2021. We got the permit in the last week of August. That is a long time for a 585-square-foot building,” Winter said.

In mid-November he was staring at an empty hole in the kitchen where the induction stove is slated to go. It was supposed to arrive in August. Light fixtures are also hung up in the supply chain debacle.

Once the final inspection takes place his adult daughter can move in.

Even with the hurdles, Winter said he would do it again.

“Building out areas like we have and other ADU owners have makes a lot of sense. It is good land use,” Winter told the Business Journal. “We used to have a little garden back here. My argument with my wife was why don’t we buy tomatoes from the farmers at the market who rely on it for their living and we will put our land to a different use.”

One thing in particular that Aqua Caliente homeowner Notaney liked about working with the Napa Sonoma ADU Center was the encouragement to call the county directly to work out issues. He said the county was a breeze to work with, something he has not found to be true in San Francisco.

Nate Atkinson, whose firm Atkinson Builders in Sonoma is building Notaney’s home, said, “In Sonoma County you can go right to the county website and you can choose preapproved plans. From there the permitting process is pretty streamlined because they want more rental units.”

Of all the legislation produced to clear the way for ADU construction, Napa Sonoma ADU Center Director Schomp said the most significant to come out of the last legislative session was SB897. It prohibits municipalities from denying an ADU unit because the primary home on the property has code violations. The Senate bill also increases allowable heights for an attached ADU.

Some North Bay jurisdictions say they are clearing the way for more ADU construction on their own. In December, Marin County begins a pilot program offering technical assistance for design, permitting and project management of ADUs.

“All participating homeowners will be required to agree to a deed restriction committing to not using the ADUs as short-term rentals. The program funds cannot be used to build the ADU; homeowners are responsible for securing funding for development costs. There is no income qualification for participating homeowners,” Marin County Community Development Agency official Bereket said.

Napa County supervisors in January will launch a $5 million forgivable loan program for residents who build ADUs and then rent them at below market rate.

In Solano County, Morris of the city of Vacaville said general plan revision are under review to create an ADU/JADU construction loan program, as well as providing approved design templates, market financial assistance programs that could provide construction funding, and streamlining permitting and reducing permitting fees for ADU permit applications.

The Solano County city is also working with developers to have ADUs as an option at the get-go.

“Between 2020 and present, one subdivision is in the process of constructing 16 new single-family homes with attached ADUs,” Morris told the Journal.


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