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Environment and economy intertwined at Tahoe

Editor’s note: This is the tenth and final installment in the Tahoe Daily Tribune’s examination of the Tahoe Regional Planning Agency’s five-year evaluation of Lake Tahoe’s environment. Today, a look at the relationship between the basin’s environment and its economy.

In the 28 years since California, Nevada and the U.S. Congress created the Tahoe Regional Planning Agency, the powerful agency has developed a body of regulations intended to protect the basin’s unique environment.

But while the complex set of regulations has stopped the runaway development that still threatens the fragile Alpine lake, critics say the pervasiveness of the rules has stifled the region’s economy.

“Although the actions are well-intended, they probably had a residual effect on the market forces that the agency didn’t understand or foresee,” said Duane Wallace, executive director of the South Lake Tahoe Chamber of Commerce. “Small business owners didn’t have the resources, the ability or the courage to take (the regulations) on.”

Jim Baetge, the executive director of the TRPA since 1994, agrees that the regulations may have made life more difficult for basin businesses. But Baetge said the rules were essential to halt the basin’s rapid urbanization.

“If you look at recent history, you can make the argument that the regulations made it more difficult to do business,” Baetge said. “But those regulations changed the way you develop the economy of Lake Tahoe, Before, new development usually meant the development of the wetlands.”

Now that the regulations are in place, the agency has shifted gears. Instead of restricting unwanted development, the TRPA is aggressively pursuing new projects and redevelopment that will help it achieve the nine principal environmental goals, or thresholds, adopted in 1982.

“The project is the fix” is the agency’s new motto, with two redevelopment projects in South Lake Tahoe cited as major examples. The Ski Run and Park Avenue projects will give the South Shore community a new look, while achieving important environmental goals, including the capture and treatment of urban runoff.

For that reason, Baetge said, the agency is committed to helping the region’s economy.

“If you regulate to the point that you don’t have a strong economy, then you won’t get the improvements you want,” Baetge said.

As part of its 1996 evaluation of the basin’s environment, the TRPA has published a list of 383 projects, programs and studies that are believed necessary to achieve the nine major thresholds and their 34 elements. The list, which will cost an estimated $730 million to complete, includes erosion-control projects, restoration of wetlands and improved views of, and access to, Lake Tahoe.

It’s a goal the business community can support, Wallace said, with a sufficient amount of agency cooperation.

“The Lake Tahoe environment is the reason we’re all here,” Wallace said. “People didn’t start businesses here to make a gazillion dollars, but to go into business at Lake Tahoe.”

In its review of the basin economy, the TRPA noted that significant population and income gains are expected in surrounding urban areas. Much of the economy depends on tourism, including gaming, which accounts for nearly half of the basin’s revenues.

Yet, the basin’s estimated 1995 population of 51,806 is sufficient to support only half of the retail business that now exists, the report states. The absence of large retail outlets also forces residents to leave the basin for major purchases, producing $8 million a year in sales “leakage” to other areas.

The number of visitors and motel occupancy rates have been stagnant for years, but Baetge said the current boom in redevelopment suggests that the basin’s economy – and its environment – can look forward to better days.

“A healthy environment will absolutely help the economy,” Baetge said. “And I think we’re getting to that point right now.”