The economics of the wine business and preserving open space are a couple of key considerations facing Neely Wine and the town of Portola Valley in the winery's effort to open a tasting room on its centrally located property at 555 Portola Road.
Kirk Neely and wife Holly Myers brought the property in 1995, taking over plantings of chardonnay and gewurztraminer grapes that descend down from their home on the top of the hill, and adding chardonnay and pinot noir vines on a lower portion of the estate adjacent to Portola Road.
Daughter Lucy Neely and son Simon Neely now operate the winery, which produces up to 2,000 cases of wine a year. Neely now sells most of its production to distributors, who in turn market it to retail stores.
Now, the family wants to open a tasting room where visitors could buy the wines directly. This would generate more profits for the winery and would help the Neelys maintain the land as open space.
The land could potentially be sold for development of up to 30 homes, according to Lucy Neely.
"Having a tasting room is essential to having a viable wine business," she said. "Having a viable wine business is supportive of keeping the land in open space and agriculture."
Nathan Kandler, winegrower at nearby Thomas Fogarty Winery, agreed that a tasting room and perhaps a wine club, in which the wine is sold to winery fans, are essential to having a profitable wine business.
"Selling directly to consumers, you avoid selling wine at wholesale to distributors for half the price, who in turn sell it to the retail stores," Kandler said. "If they're selling it at Roberts Market, they're selling it to someone else for way less than retail.
Selling wine to distributors is a break-even proposition at his winery, Kandler said.
Neely Wine's application for a conditional use permit (CUP) for the tasting room was the subject of an April 17 Planning Commission meeting where a preliminary proposal received an initial reaction from a handful of community members.
"According to the actual proposal, submitted to the Planning Commission, there would be a lot more than just creating a tasting room," said resident Jerry Kohs.
Kohs cited a 2013 CUP that he says "explicitly prohibits" the use of the property as a retail space.
"Essentially, the Planning Commission is being asked to reverse ... the 2013 CUP agreement," he said.
According to the staff report on the proposal, "Under the existing CUP customers may not come to the winery for tastings or purchasing of wine."
"(The prohibition) is highly restrictive and prohibitive for any winery that wants to engage in direct consumer sales," Lucy Neely said.
Others were more sympathetic to the plan.
"We don't want to make the open space available for development," said resident Laura Stec. "And it will be nice to have something else to do in town."
The proposal also called for the right to hold 24 events per year, with up to 75 guests each, a situation that resident Mike O'Donnell compared to "living next to a frat house."
The number and size of the events proposed also caused Commissioner Craig Taylor to pause. "The figure of 24 events per year sounds like a lot, but I'm willing to keep an open mind about it," he said. "We need something that feels feasible and sustainable."
Taylor said that he is "comfortable" with the tasting room proposal, although he preferred the tastings be done by appointment, so that the winery could control who is there.
Commission Chair Jon Goulden said he thinks noise could be a problem and wanted more information about how it could be controlled, adding that he thought concerns about the project can be resolved and that there should be fewer than 24 events allowed.
Other concerns included whether there is adequate parking for the events that would be held at the site, the possibility of guests parking on Portola Road and the potential for guests who have been drinking interacting with cars, pedestrians, and cyclists.
"The Planning Commission wants them to come back with a more specific plan," Town Councilman John Richards told the council at its April 24 meeting. "The commission was generally supportive but there was a strong concern about public events."
Lucy Neely said the winery is formulating a response to commissioners' and the public's concerns.