The program uses what are called “private activity bonds.” The tax-exempt bonds allow corporations to borrow at the low interest rates available to local governments while providing them a 4 percent tax credit to limit their tax exposure.

They’re commonly used to fund not just affordable housing but hospitals and other public infrastructure as well as private university housing. The California State Treasurer’s Office, which oversees issuance of six versions of the bonds, reported that in 2016, they were used to fund $6 billion in affordable housing projects and to provide $2.2 billion in tax credits tied to use of the bonds, according to the Los Angeles Times. This either preserved or created more than 20,000 affordable housing units.

State Treasurer John Chiang (pictured) was the leading California critic of House Republicans’ move to end the bonds. In November, he told Bond Buyer if they were successful, it would “throw gasoline on the housing shortage” in the Golden State.

While the cut in the corporate tax rate and other pending tax code changes give companies less of an incentive to buy private activity bonds to shield income, the bonds and related tax credits are also made available to developers when they are required to build affordable housing as a condition of approval for other, market-rate housing projects.

That leverage – attaching conditions to project approvals – would have remained had the private activity bonds and related tax credits been scrapped. But affordable housing advocates see the incentives as valuable sweeteners in cutting deals with developers.

Feinstein rips lowering of mortgage interest deductibility

Other changes in the tax bill may end up having the most significant effect on California housing. The National Association of Realtors expects home values to decline by 10 percent or more in high-cost states for two reasons: Because the final version of the GOP bill reduces the deductibility of mortgage interest from the first $1 million of a newly purchased home’s value to the first $750,000 and because it caps the amount of local and state taxes that can be deducted from income for federal tax filers at $10,000. The Realtors group, which opposes the tax bill, said Americans have been well-served by the tax incentives.

On Sunday, California Sen. Dianne Feinstein took to Twitter to rip the lowering of mortgage deductibility limits.

“The Republican tax bill caps the mortgage interest deduction at $750,000 for new mortgages. In California, seven counties have average home prices that are more than $750,000: Alameda, Marin, Orange, San Francisco, San Mateo, Santa Clara and Santa Cruz counties,” she wrote.

The tweet finished with a “GOPTaxScam” hashtag.

Nationally, the focus has been on the numbers illustrating the extent of the disaster – 200,000-plus acres charred, at least 40 dead and hundreds missing, perhaps more than 10,000 structures burned. But for those most directly affected, there are much more long-term fears. After Hurricane Katrina hammered New Orleans in 2005, Louisiana officials said it led to a “lost decade.”

It’s clear that dozens of wineries suffered some damage, and several were destroyed or badly damaged, including White Rock Vineyards, Ancient Oak Cellars, Paradise Ridge and Signorello Valley. The city of Santa Rosa suffered body blows to its visitor industry with the destruction of the Hilton Sonoma Wine Country hotel, Willi’s Wine Bar, the Cricklewood steakhouse, the Fountaingrove Inn and several other tourist mainstays.

This weekend, in small towns and unincorporated areas west of the main fire damage, about two dozen hotels and hundreds of private rentals were in good condition and remained open. But in hard-hit communities, with the focus remaining on firefighting efforts, it’s not clear yet how bad the damage has been to popular tourism centers, wine facilities and more. The idea that rebuilding might be quick and relatively easy is tough to square with grim images from Napa and Sonoma counties.

Authorities also emphasize that while they are optimistic, it is not a sure thing that the current fires will be contained in coming days, and they warn that windy, dry conditions could spur new infernos.

The concern about the wildfires’ economic toll is well-grounded. According to wine industry research, in 2014, tourism and wine production were responsible for about 100,000 jobs in Napa and Sonoma counties, generating $26 billion annually for the regional economy.

The region’s tourism-wine industry has already faced recent disruptions. In 2015, nearly 2,000 homes in Lake, Napa and Sonoma counties were torched by the Valley Fire.

Area already had shortage of skilled construction workers

But the latest wildfires mean another headache for the industry may only worsen: the high cost of housing, which can make it difficult to find workers for modest-paying hotel and restaurant jobs and often complicates efforts to bring in agricultural laborers.

Last month, according to realtor.com statistics, the median home price was $876,200 in Napa County and $750,000 in Sonoma County.

Average rents for modest single-family homes in the Napa area were about $2,400 before the blazes, with comparable figures in Sonoma County. Still, earlier this year, a real-estate blogger wrote that it was possible to find monthly rentals of $1,500 or even a little less.

But that claim could be ancient history in the wake of the fires taking nearly 6,000 homes – so far – out of an already-tight market. While many will be rebuilt, real-estate agents see an even-tighter market ahead, especially in Sonoma County, which has so far lost about 2,800 homes. That’s 4 percent of the county’s 67,000 housing units.

A Bay Area News Group report offered a downbeat take on how quickly the region’s housing stock might bounce back. With insurers paying for the rebuilding of homes, there will be a massive demand for skilled construction workers – and the region already had a shortage of such workers before this month’s fires, the article noted.

One expert offered hope that the wine country price shock would be limited – but for a reason that’s troubling in its own right.

“Pricing can go down, possibly, because the area is burned out and not an attractive place to live,” economics researcher Randall Bell told the Bay Area News Group.