TO: Board of Supervisors
FROM: Steven Lederer, Director of Public Works
REPORT BY: Leigh Sears, Concessions Manager
SUBJECT: Lake Berryessa Concessions Agreements
RECOMMENDATION
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Approve and authorize Agreement No. 8703 with Napa Valley Land Company, LLC, to conduct environmental studies, site investigation and due diligence, prepare environmental documents, and enter into negotiations for a long-term agreement for development and operation of resort concessions at the Monticello Shores resort area; and approve and authorize Agreement No. 260224B with Spanish Flat Campground Inc. for the continued operation of the Spanish Flat resort area. (Fiscal Impact: $20,000 Revenue; Lake Berryessa Concessions Fund; Budgeted; Discretionary)
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BACKGROUND
The County has assumed management of certain concession areas at Lake Berryessa from the United States Bureau of Reclamation (BOR) pursuant to a Managing Agreement executed in March 2020. Pursuant to the Managing Agreement, the County issued Request for Proposals (RFP) No. CEO112001 for resort concession areas at Lake Berryessa for Steele Canyon, Spanish Flat, and Monticello Shores. Based on the proposals received, the County entered into an exclusive negotiation agreement with Sun Communities for all three resort areas on October 19, 2021. Unfortunately, on June 27, 2023, Sun Communities announced it was no longer pursuing a long-term agreement for the resort areas.
The County recently engaged with Napa Valley Land Company, LLC, another firm that submitted a proposal for Monticello Shores in response to the RFP and is still interested in the resort area. The proposed Exclusive Negotiating Agreement (ENA) will commit the County to negotiating exclusively with Napa Valley Land Company LLC on a long-term concessions agreement for Monticello Shores, while the Napa Valley Land Company conducts due diligence, site investigations, environmental studies, and prepares California Environmental Quality Act (CEQA) and National Environmental Policy Act (NEPA) documents. Normally, the County hires and controls the consultants necessary to prepare environmental documents, and charges project applicants for the services pursuant to Section 104 of Napa County’s Local Procedures for Implementing CEQA. As was done with previous ENAs, approving the proposed Agreement will allow Napa Valley Land Company to deviate from this process so they can better control costs, react quicker to discoveries that may impact their proposed development, and to immediately cease work if their studies and analysis determine their proposed project is not feasible.
The development team will be led by Greg Pitts. Greg and his firm, Realty Financial Resources, Inc., have financed the acquisition and development of over $1 Billion worth of resort hospitality assets throughout the United Stated, Mexico and the Caribbean in markets such as Napa Valley, Lake Tahoe, San Francisco, New York, Aspen, Park City, Vail, St. John, St. Barth, Los Cabos, and San Miguel de Allende. Greg has extensive expertise and experience in the feasibility analysis, pre-development, planning and entitlement areas of resort development and has been involved in many unique and creative hospitality assets and projects. A copy of the project vision for Monticello Shores is attached. At maximum build-out, the project could include from 50-150 cabins, and up to 150 safari tents and yurts, but development will likely be phased based on public demand. The proposal also includes an 8,000 square foot gathering lodge, 2,400 square foot retail center, and a 2,400 square foot restaurant.
The new interim concession contract for Spanish Flat is with Spanish Flat Campground, Inc. The firm is managed by Joseph (Rocky) Costanzo, a resident of Berryessa Highlands who has also been operating the Steele Canyon resort area since 2023. Rocky is a long-time resident of the Lake Berryessa area and is very familiar with the lake. The concessionaire will pay the County 3% of the gross revenue realized from operating the site. The term of the contract will be from January 1, 2026, to October 31, 2027, with an option for the County to extend the contract for one additional year. During the term of the interim concession contract, the County will continue pursuing opportunities for future development and long-term operation of the site.
Recommended Actions:
Approve and authorize Agreement No. 8703 with Napa Valley Land Company, LLC, to conduct environmental studies, site investigation and due diligence, prepare environmental documents, and enter into negotiations for a long-term agreement for development and operation of resort concessions at the Monticello Shores resort area and Agreement No. 260224B with Spanish Flat Campground Inc. for the continued operation of the Spanish Flat resort area. (Fiscal Impact: $20,000 Revenue; Lake Berryessa Concessions Fund; Budgeted; Discretionary)
FISCAL IMPACT
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Is there a Fiscal Impact? |
Yes |
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Is it currently budgeted? |
Yes |
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Where is it budgeted? |
Lake Berryessa Concessions Fund |
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Is it Mandatory or Discretionary? |
Discretionary |
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Discretionary Justification: |
Long-term concession agreements are needed to attract private investment in the resort areas and improve recreational opportunities for residents and visitors. |
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Is the general fund affected? |
No |
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Future fiscal impact: |
County will receive increased revenue from operation of the resort area if a long-term agreement is reached. |
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Consequences if not approved: |
County will not realize the private investment needed to improve the resort area. |
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Additional Information: |
Strategic Initiative: Build Healthy, Connected Communities |
ENVIRONMENTAL IMPACT
ENVIRONMENTAL DETERMINATION: For Monticello Shores, the activities contemplated by the Agreement are either not a project subject to CEQA pursuant to CEQA Guidelines sections 15060(c)(3) and 15378, or consist of information gathering and investigations categorically exempt from CEQA pursuant to CEQA Guidelines section 15306. For Spanish Flat, the proposed action is categorically exempt from the California Environmental Quality Act under CEQA Guidelines section 15301, as the operation of existing public facilities involving negligible or no expansion of existing or former use.