If this week's Napa City Council debate is any indicator, next year's hearings on the city's first condominium conversion applications will be emotional affairs.

With two conversions coming down the pike, City Councilman Harry Martin tried Tuesday to convince fellow council members to tighten up the qualifications for apartments converting to condominiums. Napa can't afford to lose 40 or more apartments for people with low and moderate incomes, he said.

The council majority rebuffed Martin's efforts to rewrite the rules before 38-unit Cadillac Flats on Soscol Avenue and 42-unit Marina Vista on Marina Drive can have their condo applications heard.

The question of whether either one of these conversions threatens Napa's affordable housing supply can be addressed at future hearings, the majority said.

Condo conversions became possible last summer when the city's apartment vacancy rate rose above 5 percent, triggering a local law that allows up to 48 apartments to be converted to ownership housing.

Martin challenged the vacancy formula. The city's newest, most expensive apartments are responsible for a high percentage of vacancies, yet apartments less than 10 years old are not eligible for conversion, he said.

The vacancy rate among low- and moderate-priced apartments is well below 5 percent, Martin said. It is residents of these units who would be displaced.

"What are we going to do with the people who live in these places?" said Martin. The city would be undoing recent gains in affordable housing, he said.

Kathryn Winter, executive director of Fair Housing Napa Valley, made a similar argument, saying the city should not be shrinking the supply of affordable apartments.

Kathy Hayes, representing the North Bay Association of Realtors, urged the council to stay the course, hold hearings on conversions and then decide. The demand for condos exceeds the Napa supply, she said.

Councilman Kevin Block said the issue wasn't "condos versus affordable housing," but "affordable rental housing versus affordable ownership housing."

Too many teachers and police officers move to Fairfield and Vacaville because Napa does not offer much entry level ownership housing, Block said.

If the Cadillac Flats or Marina Vista conversion application is faulty, the council can vote no, he said.

Two-bedroom apartments at Cadillac Flats, which now rent for nearly $1,000 a month, would reportedly be sold for between $325,000 and $350,000.

Cheryl Flemate, a renter at Cadillac Flats, said she could not afford to buy her apartment as a condo. Neither can she afford the higher rents in the new upscale developments, which do not take animals, she said.

If the four newest, most expensive apartment projects had been excluded from the formula, then the city's vacancy rate last summer would have been 4 percent and no conversion applications would have been allowed, said city planner Jean Hasser.

City staff recommended proceeding with the current formula and holding conversion hearings. The formula can be reviewed before a new vacancy rate is calculated next summer, Hasser said.

"We'll have an opportunity to test it," Councilman Jim Krider said. "If it crashes and burns, we'll have an opportunity to redo it."

Councilman Mark van Gorder reassured several tenants in the audience that it was too early for them to worry about being displaced. Hearings will be conducted on each application and they will have a chance to speak then, he said.

The conversion ordinance gives lower income tenants the equivalent of six months rent to find another apartment.

With fewer new apartments coming on the market, the vacancy rate will likely be lower next summer even if the formula isn't changed, staff said.