Novato Keeps Solving 21st-Century Problems With a 20th-Century Playbook

Novato has a habit problem. Not with its priorities, but with its imagination. The threats facing the city have changed shape over the last generation, from a rising bay and a highway headed underwater to wildfire pushing down out of the hills and a dam that no longer feels permanent. Yet the way local government proposes to pay for any of it has barely moved in decades. The playbook is the same one it has always been: when the bill comes due, reach for the taxpayer. Another parcel tax, another bond, another line item that lands on the same homeowners who are already stretched thin. Novato voters just watched that reflex play out again over a proposed $249 parcel tax on top of the $251 they already pay.

The deeper issue is not any single tax. It is a mindset that treats the taxpayer's wallet as the only lever in the building. Every budget conversation hits the same wall and produces the same answer, as if no other option exists. State Route 37, the city's only real link to Sonoma and Napa, is projected to be underwater by 2040 with a fix estimated in the billions. Fire Station 62 sits in both a flood zone and a high fire-hazard zone. Stafford Dam's aging earthen face keeps eroding, and the County's own 2023 hazard plan warns that a worst-case failure would send floodwater through parts of town. These are twenty-first-century problems. They deserve better than a twentieth-century funding reflex.

Solving them starts with a willingness to rethink the question itself. Instead of asking how much more to charge the people who already live here, the better question is whether the city's own future growth could carry the load. It can, and the mechanism to make it happen has existed in California law for over a decade, with a sharper version added in 2022. It is called tax increment financing, and almost no jurisdiction in Marin has reached for it. Understanding it is among the most useful things a Novato voter can do before the next budget cycle.

California has quietly handed local governments two versions of this tool. The first is the Enhanced Infrastructure Financing District, or EIFD, authorized by SB 628 in 2014 and codified at Government Code section 53398.50. The second is its newer, climate-focused cousin, the Climate Resilience District, or CRD, created by SB 852 in 2022 and codified at section 62300. Both rest on the same underlying mechanism, and that mechanism is simpler than the acronyms make it sound.

Set the jargon aside for a moment. A financing district is just a way for local government to set aside the extra property tax created by future growth and spend it on local projects, without anyone's rate going up. It works in three steps.

First, a boundary is drawn and the baseline is frozen. The County or the city draws a line around an area and records the property tax collected there today. That baseline keeps flowing to schools, the city, and every other agency exactly as it does now. Nothing existing gets taken away. Second, only the growth on top is captured. As assessed values inside that boundary rise over the years, the extra tax created above the frozen baseline, the increment, is diverted to the district instead of dissolving into the general pool. No property owner pays a higher rate. The growth simply gets a local address instead of disappearing into a statewide formula. Third, and this is the part that changes everything, the district borrows against that future growth to fix things now. Because the increment is a predictable stream, the district can sell bonds against it, take the cash up front, and repay the debt over time out of the growth as it arrives. The repairs happen today. They pay for themselves tomorrow.

That third step is the difference between a town that manages decline and a town that gets ahead of it. Most local governments can only spend money they have already collected, which means they are permanently one disaster behind their own infrastructure. Tax increment financing lets a community act on the schedule the problem demands rather than the schedule the cash flow allows.

An EIFD can fund a broad menu of public infrastructure, from roads and transit to parks and sewers. A CRD is narrower by design, and that narrowness is precisely its strength for a town like Novato. Under SB 852, a CRD exists to fund projects that address sea-level rise, flooding, wildfire, drought, and extreme heat or cold. It can pay for levees, wetlands and living shorelines, structure elevation, fire breaks, vegetation control, and structure hardening.

Read that list against Novato's actual hazard profile. The shoreline and the FEMA-certified Hamilton levee. The SR-37 corridor. The wildland-urban interface around Station 62. Stafford Dam. A CRD is, functionally, a financing tool written for the exact risks the County's own BayWAVE study and 2023 hazard mitigation plan already flag for this town. It is rare to find a state financing mechanism that maps this cleanly onto a single community's list of unfunded needs. Novato does not have to bend a generic tool to fit its problems. The tool was drawn around problems Novato already has.

The legal structure reinforces the point. A CRD is treated as an EIFD and follows the same formation process. That matters for two reasons that cut directly against the usual objections. Forming the district requires no public vote. It runs through a resolution of intention, an infrastructure financing plan, and public hearings with a majority-protest safeguard, not a costly ballot measure. Voter approval enters the picture only if the district levies a brand-new tax, or when it issues tax increment bonds, and even then the threshold is 55 percent rather than the old two-thirds. Capturing the increment and putting it to work does not require asking homeowners to raise their own taxes. It requires the Board of Supervisors and the City to do the paperwork.

Here is the piece unique to this county. Under Proposition 13, a home's assessed value stays largely frozen until it changes hands, then resets to current market value. Marin has one of the oldest populations in California, which means an unusually large share of long-held homes will turn over by sale or inheritance in the coming years. Each turnover triggers a reassessment, often from a decades-old, deeply suppressed value up to today's far higher market price. That jump, the gap between a 1980s assessment and a 2020s sale price, is exactly the growth a financing district captures.

So Marin is positioned for an unusually large and predictable wave of future increment. A bigger, steadier stream supports a bigger bond, and a bigger bond means more backlog cleared up front. None of it raises anyone's rate. The reassessment happens under existing law the moment a property sells, whether or not a district exists. The only question is whether that growth funds Novato's levees and evacuation routes or quietly vanishes into the general statewide pool.

And waiting is not free. Deferred maintenance does not sit still. It compounds. Marin's own capital plan shows roughly $223 million in road and bridge needs over five years against only about $39 million a year to pay for it. A road, levee, or culvert left unrepaired keeps degrading, and once failure forces an emergency rebuild the bill often runs several times the cost of the timely fix. Waiting does not save money. It guarantees a larger bill and, in the case of a levee or a dam, a larger risk to life. Bonding against future growth lets the County attack the backlog while it is still small.

The question facing District 5 is not whether Novato has problems. Everyone knows it does. The question is whether the tools already available get used to fix them without reaching into the same taxpayers' pockets one more time. Every Marin jurisdiction that delays permanently cedes another year of growth to a formula that sends it somewhere other than here. No Marin jurisdiction has formed one of these districts yet.

A logical first step would be for the Board of Supervisors to direct staff to prepare a feasibility analysis for a Novato-focused Climate Resilience District, to model the projected increment from Proposition 19 and Proposition 13 turnover in the shoreline and SR-37 corridors, and to bring a resolution of intention forward within this budget cycle. This is not a new tax. It is a decision about whether Novato's own growth works for the community or for someone else.

Trust Through Transparency

Marc Hunter Lewis

Sources for this article include the California Government Code (SB 628, section 53398.50 et seq.; SB 852, section 62300 et seq.), the Marin County Annual Comprehensive Financial Report (FY ended June 30, 2025), the Marin Shoreline Sea Level Rise Vulnerability Assessment (BayWAVE), and the 2023 Marin County Multi-Jurisdictional Hazard Mitigation Plan.