Napa County affordable loan program for ADU construction officially launches

Napa County’s first-in-the-country forgivable loan program for accessory dwelling unit construction has officially launched, the county announced in a Friday press release.

The loans are intended to make it easier for people to build ADUs, which are living quarters that can be attached or detached from a main residence. ADUs have been touted by state lawmakers as one way to help address California’s housing crisis, and the state has passed laws in recent years to make approvals of such units smoother at the local government level. (ADU approvals have been picking up across Napa County and the state in recent years, but the estimated need for housing remains astronomically higher than the number of approved ADUs.)

The loan program specifically addressing a “housing affordability gap” by providing forgivable construction loans that range from $45,000 to $105,000, depending on the number of rooms and design features of the proposed ADU, according to the news release. That’s in exchange for commitments to rent the properties to households earning up to 80% of the area median income for a period of at least five years, the release says.

“This is a huge step in addressing the housing affordability crisis facing Napa County and the state,” said Belia Ramos, chair of the Board of Supervisors, in the press release. “This program is the culmination of a seven-year effort of collaborative public-private partnerships. We’re excited to see where this program goes. This is just the beginning.”

Those interested in applying or learning more can visit the relevant portion of the county’s website at: http://www.countyofnapa.org/aaduloan. The application is a three-step process, according to the press release, and is designed to move at the pace of construction. That means homeowners move through steps of expressing interest, gaining access to a free feasibility consultation and video classes, then committing to loan funding as the project “moves from idea to design to permitting and construction,” the press release says.
The county started working on the program in April 2022, when the Board of Supervisors directed staff to work with consultants at LeSar Development, the Napa Sonoma ADU Center and other stakeholders to develop the program. Underwriting guidelines that established the program were approved by the board in November that year, and staff worked in the following months to finalize the application, loan documents and other contracts, the press release says.
Applications are being accepted on a rolling basis while funding is available, according to the release.

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