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New Capital Solutions to Expand Affordable Housing in Napa, California

View more stories from our 2022 Annual Report

Although California’s Napa Valley is famous for opulent vineyards and lavish chateaus, the veneer obscures a diverse community with an affordable housing crisis compounded by climate change and drought. Over the past seven years, Jennifer Palmer, the Director of Housing & Homeless Services for the county and a participant in Reinvestment Fund’s Invest Health program, has charted a path forward while contending with wildfires that destroyed over 650 homes and the subsequent COVID pandemic emergency.  

Through Invest Health, which is supported by the Robert Wood Johnson Foundation, Palmer has traveled across the country and met other leaders from 50 different small to mid-sized cities who are also developing strategies for increasing and leveraging private and public investments to address issues like housing with a focus on health and racial equity. Beginning with a modest grant in 2016 and then leveraging connections and learnings from across the country, Palmer has rallied Napa county around novel solutions to addressing entrenched health problems that stem from housing and the built environment. 

 The Association of Bay Area Governments has determined that 18,400 additional housing units are needed in Napa and neighboring Sonoma counties by 2031. Further quantitative and qualitative data collected by Palmer and her team document the many households living on the edge of homelessness and struggling with the high costs of living, in addition to loneliness and social isolation due to personal health issues.  

 With housing affordability in mind, the Invest Health Napa team focused on bringing Accessory Dwelling Units — or ADUs – to the county. ADUs are small houses or apartments built on the same property lot as a single-family residence. Research shows that ADUs are often rented for under average market rates and expand the number of housing units in a community.  

 “In Napa, we found an equal number of homeowners struggling with aging-in-place as workforce members struggling to live near where they work,” says Palmer. “Families also need options to support intergenerational living, and ADUs offered solutions to build community and expand housing options.” 

 Though there is promise, the ADU building process faces many barriers, including zoning, permitting, and financing. The Invest Health program model, which asks teams to build relationships across siloed sectors and bring in nontraditional partners, nurtures the collaboration needed to bring an innovation like ADUs to a community. Palmer met with Invest Health teams in Grand Rapids, MI, and Portland, OR, to explore financing models and ADU best practices. “We’ve been connected to so many other communities and built a support network,” says Palmer. “Walking this ADU journey in connection with others has been so important, and we continue to learn from others, just as they are following our work and learning from us.” 

 Bringing this expertise back to Napa, Palmer helped create an entirely new interlocking system that enables ADUs to be built with relative ease. Napa’s “ADU Accelerator System” includes three components: a “one-stop shop” website designed to move homeowners thinking about building an ADU from intent to action, a first-of-its-kind ADU construction loan product that simplifies access to construction capital for fixed-, middle-, and lower-income homeowners, and a new municipal investment in ADUs in the form of the “Napa County AADU Forgivable Loan Program” that ensures affordability. 

 Palmer and the Napa team are incubating other ideastoo, with plans for a landlord-tenant match-up program to make connecting with eligible tenants easier for homeowners, and a risk mitigation and incentive fund to further incentivize renting to very-low-income tenants. Their work continues to inform ADU implementation across the Invest Health network and influence cities across the country. Lessons from Invest Health and how it catalyzes investments in the 50 small to mid-sized cities continues to evolve with the program now in its seventh year. To learn more, visit 


For more information, contant:

Jennifer Fassbender
Director of Program Initiatives

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