American Canyon seeks to annex more than 360 acres
American Canyon has taken the first steps to annex more than 360 acres north of its current boundaries east of Highway 29 to South Kelly Road.
The proposed annexation, if approved by the Napa County Local Agency Formation (LAFCO) , the agency that approves boundary changes in Napa County, would allow the city to extend Newell Drive to South Kelly Road, creating an alternative route to much-congested Highway 29.
In exchange for the land, the city would agree to take on some of Napa County’s future state-mandated housing requirements. Under state law, every jurisdiction must plan to house all its populations, including its low-income residents. The state issues new housing goals every eight years.
The proposed annexation includes about 241 acres known owned by Hess Persson Estates’ owners, 40 acres owned by the Laird family and about 83 acres along owned by multiple property owners along Watson Lane and Paoli Loop.
According to an American Canyon staff report, “This benefits everyone because it helps ensure other unincorporated county lands remain as agricultural and open space free from urban development.”
To that end, the American Canyon City Council on April 21 unanimously voted for a resolution to expand the urban limit line north to South Kelly Road and to take a portion of Napa County’s future state-mandated housing allocations. The City Council also approved two property tax-sharing agreements with Napa County for the Hess/Laird and the Watson/Paoli Loop territories.
“There is a lot of win-wins in these proposals,” American Canyon City Manager Jason Holley told the American Canyon City Council.
The current urban limit line, which sets the city limits is in place until 2030 under a deal struck with Napa County in 2008. The citizen-led initiative that year was adopted by the City Council after enough signatures were collected to place the measure on the ballot. The city’s new boundary line was to remain in place until 2030.
On Tuesday, the American Canyon Fire Protection District board, whose directors are city council members, voted on a property tax sharing agreement for the Hess-Laird properties. The 280-plus acres, unlike the Paoli/Watson lane properties, lie outside the fire district boundaries.
The agreement is between the fire district, the city of American Canyon and Napa County.
On April 21, developer Rick Hess spoke on behalf of the Hess/Laird ownership (Hess is not related to the late Donald Hess, founder of The Hess Collection now known as Hess Persson Estates). Hess/Laid owners are willing to grant the right-of-way for the extension of Newell Drive, he said. “We are in full support of the package that you have before you tonight and encourage you to move forward.”
The Napa County’s Board of Supervisors may vote on the resolutions in May. If approved, the proposed annexation of these 360-plus acres may come before Napa LAFCO on June 1.
Similar deals have been struck over the years, including a 2008 agreement between Napa County and American Canyon that resulted in a new urban growth boundary line that brought more land into the city.
That expansion included Watson Ranch, where Terrence “Terry” McGrath continues to develop more than 250 acres. As of last October, more than 200 have been built, along with a 187-unit apartment complex, Lemos Pointe, named after the late Fran Lemos. The development also includes industrial ruins known as the Napa Valley Ruins and Gardens.
McGrath’s American Canyon I LLC in October sued the city in Napa County Superior Court over a number of issues, including better road access.
McGrath said on April 7 a ballot initiative had been submitted at City Hall to extend Marcus Road, a new road in Watson Ranch, to existing Watson Lane. Watson Lane leads to Paoli Loop, a road that connects to Highway 29.
Watson Ranch lies east of railroad tracks. Connecting Marcus Road to Watson Lake would give “immediate access for all residents live on the east side of the railroad tracks,” McGrath said. That would not prevent the extension of Newell Drive “in the future, whenever that may be,” he added.
Extending Marcus Road to Watson Lane and improving Watson Lane could be completed in two years, McGrath said.
In 2024, Napa County Board of Supervisors rezoned the Hess/Laird properties from agricultural watershed to industrial at the request of the property owners. Napa County had initiated the re-designation in 2021. In its application, The Hess Collection Winery stated up to 4.5 million square feet of “industrial uses” could be built on the land.
On April 21, Skyler Sanders, an attorney for McGrath’s American Canyon I LLC, said the City Council cannot change the 2008 urban limit line without voter approval because the 2008 resolution stated the urban limit line was supposed to remain in place until Jan. 1, 2030.
City Councilman David Oro asked the city attorney for clarification.
Referring to Sanders’ comment, City Attorney Teresa Highsmith said there was no such restriction, noting the resolution was a prerequisite step and that other parties are involved before the annexation can be reviewed by Napa LAFCO.
Vice Mayor Mark Joseph said the extension of Newell Drive has been part of the city’s circulation plan for 30 years. “It needs to be fast tracked,” he said.
American Canyon has expanded its boundaries five times since its 1992 incorporation.
