Letters are sent to gauge interest in collaboration on convention center | TahoeDailyTribune.com

Letters are sent to gauge interest in collaboration on convention center

The South Tahoe Redevelopment Agency has taken steps to test the level of buy-in from property and business owners in the area near Stateline that’s set aside for a convention center complex. The city developed a list and sent out a letter to them Friday to solicit their level of interest in the 16-acre project proposed between Highway 50, Cedar, Friday and Poplar avenues. The city will ask if the businesses would participate in the $325 million project, which calls for a 300,000-square-foot condominium hotel, 200,000-square-foot convention center and 34,000 square feet of retail space. After numerous extensions and changing developers, the joint front runner to construct the 12-year-old concept appears to be Falcon Capital’s Randy Lane of Stateline and DGD Development’s John Serpa of Carson City. But the project ultimately awaits reaction from the property owners, who have 30 days to reply. The two developers who formed the Lake Tahoe Development Co., with Intrawest Corp. pledging marketing assistance, took over for Marriott Ownership Resorts and partners. Marriott bowed out, prompting the exclusive negotiating agreement between the hotelier and the city to expire last Friday. “We looked at (developing the property), but from our standpoint, it would take a lot to fall into place. The Falcon group is very capable of picking this up and pursuing this,” Marriott’s Ed Kinney said. Lane has already made his own progress in signing on properties. He owns Lake Haven and Carousel motels, and escrow is pending on six others, he confirmed last week. “It’s really not what they do,” Lane said of Marriott in reference to this project. The developer said he decided to take the risk because he saw an ideal opportunity. He also cited his long history of being in the area. There are other considerations. “Not too many people would step up to make the financial commitment. We have a lot of confidence we can get it done. For an outsider, it’s harder. We’ve been around the community,” Lane said. The city Redevelopment Agency negotiated tirelessly with Falcon Capital and partners to ensure this is the right move. After experiencing the sting of using $7 million out of the general fund to pay for the Marriott-anchored Park Avenue project, the local government established an agreeable financing plan that would require no money out of the general fund, no obligation in property acquisitions and no bond-supported loans. The plan calls for two forms of financing in which the city would turn over property tax revenue to fund the project. Essentially, the developer foots the construction bill, and the city comes out of it owning a convention center, which could take up to seven years to build, according to city officials. Douglas County could even get in on the act. County Manager Dan Holler said if the Nevada Legislature writes a bill to allow for it by next session starting in January, the Stateline county may pledge 2 percent of its motel room tax from the Tahoe Township to pay for the project. “This should grow the room-night business and help the sales tax,” Holler said. An idea brought forth by the developer, the city may even raise its motel room tax to 13 percent – either in the affected area or citywide. Standard properties now pay 10 percent with an additional $1.50 per room, per night. Those in the redevelopment zone pay 12 percent. Property and business owners to receive a letter of intent from the South Tahoe Redevelopment Agency on convention center plan: Roadside Inn, Travel Inn, Greenhouse, Tahoe Tropicana Motel, Carousel Motel, Driftwood Lodge, Carriage House Inn Motel, Rainbow Lodge, Holiday Lodge, Lake Haven Motel, Economy Inn & Suites, Ski Haus Lodge, Black Jack Motel, Tahoe Tom’s, Buffalo Trading Post, Sierra Shirts, La Baer Inn, Stateline Unocal, Discount Ski & Snowboard Rentals, El Dorado Motel, Tahoe Gifts & Tees, Shirt Stop, Driftwood Cafe, Ski Haus Lodge, Black Jack T-shirts, Alpaca Advantage, Womack’s BBQ, Up Shirt Creek, Powder House, Cal Va Rado Motel, Heavenly Sports, First State Loan Office, Pub Tahoe, Sierra Nevada Realty, Brown Commercial Rental, Taco Bell Express, Discount Ski & Snowboards, Paradise Timeshare Resale, Lakeside Landing, Psychic Readings by Rose, Peabody’s Coffee, Goodie Chest

Douglas County looks at vacation renatal ordinance

STATELINE – The Douglas County Board of Commissioners on Thursday pledged to grind out an ordinance that will deal with noise, parking, overcrowding and other public nuisance complaints involving vacation rentals. By listening to concerned residents and vacation home property managers, county staff has made an effort in the last month to figure out how many homes in the county are used primarily as vacation rentals. This summer, county staff mailed out 3,400 surveys to gather that information. It has gotten a huge response – about 50 percent, when 10 to 20 percent is the norm, said Barbara Reed, Douglas County clerk. An attorney representing the Zephyr Heights Improvement District, Deborah Palmer, said at the commission meeting on Thursday that the county is ignoring the county code by not taking any action. Palmer also said the county and the Tahoe Regional Planning Agency have been passing the buck for too long. Her sentiments seemed to fire the commission’s resolve to come up with an ordinance. “Who does the enforcing of zoning laws at Lake Tahoe?” said Bernie Curtis, county commissioner. “The answer right now is that nobody wants to … somebody’s got to do it. I’ve got a hunch it’s going to be us.” Curtis said the county should look to see how other tourist-based communities handle the issue. He said the solution may involve some type of permitting process. Earlier in the meeting, Dan Holler, county manager, said that process could end up being compared to how liquor licenses are distributed in the county. “We are going to regulate it,” said Holler, adding that the TRPA would likely be the one to come up with language that defines vacation rentals. “I think we are on the right track,” said Commissioner Jacques Etchegoyhen. “To really hit this issue head-on we need to work with rental agencies.” Douglas County will have its next meeting about vacation rental on Nov. 13 at 3 p.m. The location has not been decided. Those who want to attend should call Holler at (775) 782-9821. Also at the Thursday meeting, the commission asked its staff to make every effort to publicize the auction of three parcels of land it owns on South Benjamin Drive off Kingsbury Grade. The auction will be Nov. 20. Thus far only one party, Falcon Capital, has bid on the three properties, which are close to the Boulder Lodge at Heavenly Ski Resort. Falcon Capital is a development company based at Round Hill known for its time-share projects. The company delivered an appraisal of the properties to the county and valued each at $90,000. Commissioner Curtis said he thought that seemed like a low bid for land at Tahoe. Lorraine Marlowe, a resident of South Benjamin Drive, told the commission that the parcels do not contain much land classified to be built on. But, she said, a developer would have the ability to purchase land coverage and build on the land. “I’m leery of what Falcon can do to our neighborhood,” she said, noting that Falcon already owns two lots in the neighborhood. “Why does it have to be sold at all if it’s going to the hands of a large developer?” Commissioner Etchegoyhen responded to Marlowe’s concern by saying staff would do its best to publicize the auction. “We want to maximize the value we get for the land,” he said. “We’ll do our darndest. But on Nov. 20, I suggest folks bring their checkbooks.” – Gregory Crofton can be reached by e-mail at gcrofton@tahoedailytribune.com

Trendwest breaks ground on Round Hill time-share project

Trendwest Resorts, out of Washington, broke ground about two weeks ago on a 110-unit time-share project in Round Hill. Trendwest purchased the 11-acre wooded site on Elks Point Road from Falcon Capital in May for $7.4 million, according to the Douglas County Assessor’s office. Trendwest officials said Round Hill was chosen because of its unique environment and because many of the resort operator’s club members were interested in Tahoe as a vacation destination. “We chose Lake Tahoe because of its vast recreation opportunities,” spokeswoman Pat Peckol said. “Come on. Where else on God’s green earth can you find everything Tahoe has to offer.” Peckol said the resort will most likely be named the WorldMark Lake Tahoe. WorldMark is a homeowners association that sells membership in the resort’s ownership program. Club members earn vacation credits and can use them at any of Trendwest’s 44 resorts in the United States, British Columbia, Mexico, Fiji and Australia. “The (Round Hill) project allows us to offer a limited number of units for sale through the Trendwest Fractional Interest Program,” said Gary Olmeim, Trendwest’s vice president of resort development. “The remaining units will be assigned to Worldmark, The Club.” Peckol said a price range hasn’t been established for the time-shares, but she expects them to go on sale when Trendwest finishes construction of its six residential resort buildings, scheduled in spring 2002. The unit size or amenities haven’t been decided on either, according to Peckol. However, the resort will offer a lodge, pool and workout facility. Falcon Capital had been trying to find a buyer for the property for three years. Sunterra Corporation entered into an agreement with Falcon in 1999, but backed out a month before it filed Chapter 11 protection. Kevin Lane, son of Falcon co-owner Randy Lane, said Falcon owners even thought about developing the land, because time was running out on the three-year ground-breaking deadline set by Tahoe Regional Planning Agency permits. “Trendwest made an offer in the 11th hour,” Lane said. “We sold it to them because we’re not in the business of developing resorts. The return could have potentially been a lot greater if we developed it, but the risk would also have been a lot greater.” Falcon Capital was able to transfer market-rate allocations for the Round Hill resort from the demolition of the Lake Vista Apartments on Kahle Drive. Pam Drum, TRPA public information officer, said Falcon is responsible for the restoration of the sensitive land along Kahle Drive where two of the five Lake Vista Apartments still stand. The restoration is one of TRPA’s requirements to mitigate the new construction. The environmental assessments for the Round Hill project were completed and public comment collected nearly two years ago when Sunterra was going to build the resort, Lane said. Sunterra originally proposed 138 units. Since Trendwest is constructing only 110 units, TRPA permits were issued to Trendwest after staff evaluation of the proposal and did not have to be voted on again by the bistate Governing Board.

Kids learn about the environment

Though high winds and choppy waters canceled scheduled boat rides at the seventh annual Lake Tahoe Children’s Environmental Science Day, everyone involved in the event hailed this year’s program at Sand Harbor as a resounding success. Even without being able to use the two vessels to measure Lake Tahoe’s famous clarity with Secchi dishes, the free event still boasted educational booths and presentations by 14 local research agencies. The event, hosted by the Lake Tahoe School in Incline Village, aims to teach kids ages 8 and up about environmental issues and good stewardship by allowing them to explore informational booths, hands-on displays and presentations by local researchers at their own pace. This year, about 75 children attended, many of them returning. Lake Tahoe School science teacher D.C. Larrabee, who facilitated the day’s events, said that organizers encourage parents to simply drop-off their children and let them wander from exhibit to exhibit on their own. According to Larrabee, this technique gives kids a stronger sense of “intellectual ownership” of the information they encounter, which hopefully increases their interest in learning more. Larrabee said that the program is clearly engaging kids, many of whom have attended the program in years past. “It’s really cool to see (so many) returning customers … and to see the intellectual development of some of these kids,” he said. “Some of (them) could run their own booths.” Larrabee also remarked on the growing number of girls in attendance, and estimated the male/female ratio was approximately 60/40 this year. He noted that there has been a increasing push by parents, especially mothers, to educate their daughters about math and science. Sophie Breider, an 11-year-old from Incline Village, said that this year’s program was better than the one she attended two years ago, even without the boat rides. Both Breider and her friend, Lauren Fike, said their favorite display was the aquifer model run by the Nevada Rural Water Association. The aquifer was also popular with out-of-towners, such as Kathleen Davis, 11, who came to Environment Science Day from Woodland, Calif., with her sister and their two friends. “(I learned) how we can help the environment by not polluting and not adding oil to the water or (by) making the wells deeper,” Davis said. The model, which looked something like a submerged ant farm, demonstrated how small chemical leaks can adversely affect millions of gallons of drinking water by seeping through porous layers of sediment. The event also attracted new organizations this year, including the Desert Research Institute, whose display featured a large photoelectric cell and a trading card game that teaches kids about renewable energy sources. Jake Sunderland, who designed the trading cards, estimated that at least 60 children had taken the trading cards home with them. Also new this year was the California Tahoe Conservancy, which geared its display about the effects of erosion caused by human development towards some of the younger kids, according to a land steward with the conservancy. Returning organizations included Space Science for Schools, the Tahoe Region Planning Agency and the U.S. Geological Survey.

Construction of multi-million, lakefront units to start in May

Lakefront duplexes priced in the millions of dollars are expected to sell long before they get built in South Lake Tahoe. Demolition to make way for Sierra Shores, eight town homes to be built in a horseshoe-shape on three acres across from Takela Drive, is scheduled to begin May 1. With lakefront property rare at Tahoe – and the fact that there has been so much interest in the project already – the sales director for the project is confident that all of the units will be sold by the end of June. “We’ve seen quite a strong response since we put the word out about two weeks ago,” said Corinne Huntress, a sales director for Playground Destination Properties. Construction of the three-story town homes is scheduled to be finished by December 2005 and cost $40 million. Each building will have two units: a three-bedroom/three-bathroom unit downstairs, and four-bedroom/four-bathroom unit upstairs. The three-bedroom units will be priced around $2 million. The four-bedroom units will go for around $3 million. Quarter share ownership is also available. A quarter share of a three-bedroom unit will cost about $550,000, Huntress said. Sierra Shores will be a gated complex, have a pool, garage and access to a 310-foot stretch of beach. A public bike trail will constructed around the complex and run to the beach between Sierra Shores and Best Western Timbercove Lodge. Five buildings stand on the property today. One will remain for a short time and will be used as a sales center. An open house for invited guests is scheduled June 26. Falcon Capital, a development company based at Round Hill, is building Sierra Shores. – Gregory Crofton can be reached at (530) 542-8045 or by e-mail at gcrofton@tahoedailytribune.com

Council considers eminent domain to secure redevelopment plan

The South Tahoe Redevelopment Agency may move today on using eminent domain on five parcets that have held out on selling to a developer to make way for a proposed $410 million convention center complex on 12 acres near Stateline. Eminent domain is the legal taking of private property from government. The meeting begins today at 9 a.m. at the Council Chambers inside the Lake Tahoe Airport, 1901 Airport Road. Lake Tahoe Development Co., consisting of Falcon Capital’s Randy Lane of Stateline and DGD Development’s John Serpa of Carson City had already closed or near finalized buying 29 properties located between Highway 50, Cedar, Stateline and Friday avenues. But it had indicated it may need the city’s help to continue with its plan for a convention center, two condominium hotels, a greenbelt area with a pond and walking path as well as retail space. Seven of the eight addresses are located on Lake Tahoe Boulevard. The other one stands on Friday Avenue. The city was steadfast in claiming it would only use eminent domain as a last resort. But the proposal is on the fast track, with a groundbreaking deadline of May 2007. When it approved the concept a few months ago, the city had agreed to kick in about $65 million to help fiance the venture through future revenue proceeds. It had budgeted an estimated $8.5 million in eminent domain costs. In other business, the City Council may pass a resolution establishing the South Lake Tahoe Tourism Improvement District managed and paid for by lodging properties in town.

A third of merchants polled say they want redevelopment

Although the one psychic on the block located in the next phase of South Lake Tahoe’s redevelopment appears to be leaving it up to fate, nearly a third of the 37 business owners affected said they’re willing to be an active participant in the proposal. That’s what the city Redevelopment Agency wants to know as it decides as early as next month to get into a development agreement to build a convention center with Lake Tahoe Development Co., a company owned by Randy Lane of Falcon Capital and John Serpa of DGD Development Co. The project would mark a dramatic aesthetic change to the side of the highway across from the newly developed Heavenly Village. The city sent out letters to each business two weeks ago to get a reading on these companies’ level of buy-in to a $325 million project now deemed to come with a 200,000-square-foot convention center, a 300,000-square foot condominium hotel and 34,000 square feet of retail space. The Tahoe Daily Tribune contacted each business owner. They are being asked to reply to the city within a few weeks. One 11-year business owner in the proposed area, psychic Rose Adams, said she discarded the letter. “I think the way my personality is, if the bulldozers come, I may strap myself to the building. My heart and soul is here,” Adams said. “I threw (the letter) away. I’ll wait and see what happens.” Some of these businesses between Cedar, Poplar, Friday avenues and Highway 50 have been in the area for 40 years, as in the case of Driftwood Cafe – a diner on Laurel Avenue. Cafe owner Bud Hillman, who bought the place from the Driftwood Lodge’s Edwards family six years ago, represents one in 13 business owners who are interested in participating. But that means he wants to run the restaurant in its new home. “I think the project is a good thing. But I’m afraid of high rents, which could change the whole vibe of the Driftwood,” said Hillman, whose lease runs out in about four years. The project could take seven years to complete. With interest in building the project, Lane has already began working behind the scenes. He’s bought two of the motels – Carousel and Lake Haven – and has almost completed transactions in escrow on five others. They include: Roadside Inn, Travel Inn, Carriage House Inn, Rainbow Lodge and Driftwood Lodge – the latter two are owned by Rick Edwards. For years, he’s expressed a desire to be bought out. He plans to retire in Reno. Ed Chen, who owns the Holiday Lodge, said he wants to keep his family ties in South Lake Tahoe. The Marin County judge said the hotel has stood as a landmark since 1961, but he’s interested in hearing what the city and developer have in mind. “It depends on what (the offer) looks like,” he said. Some have been frustrated by the delay. The concept has floated around for almost a dozen years – with the city negotiating with Harveys, then Harrah’s then Marriott and now Falcon Capital and partners. “If they had asked 11 or 12 years ago, I’d be signing a lease. But with (this much time) going by, I don’t know what I’m going to do,” said Bob Daly, who owns Discount Ski and Snowboard, located off Highway 50. The businesses on the major thoroughfare may have a harder time letting go of their livelihoods. Stardust co-owner Jan McCarthy said her family’s property, which operates under Sierra Nevada Realty and part of the Paradise Timeshare Resale, may be too expensive to buy. “We don’t want to go, but we don’t mind moving. We support the convention center. We’re certainly interested in being in a key location. Redevelopment is important, but that’s its double-edged sword,” she said. Valerie Banon of Mountain Java believes there’s room for a coffee purveyor. The Banons bought Peabody’s and changed the name in February, so they feel they’ve just started their business. Pete Joseph of the Pub Tahoe, which also lies on the major thoroughfare, expressed a similar sentiment. Joseph has enjoyed a stellar business with that location. He said he wants “to be involved, if the opportunity presents itself.” Ideally, he’d like to keep his bar going. He’s unsure how the project could be done without eminent domain, the redevelopment government’s version of the taking of property to eliminate blight and generate tax revenue. The Park Avenue project cost the city at least $12 million in acquisition fees and legal costs. City Manager Dave Jinkens said he “wouldn’t even speculate” what will happen. The council has mentioned it wants the developer to handle the property acquisitions. “The project has changed dramatically. There has got to be a venue for everybody,” Jinkens said.

TRPA hides behind bureaucracy

The Tahoe Regional Planning Agency made a deal with Falcon Capital developers and both made out like bandits. The TRPA gets a stormwater retention pond and Falcon Capital gets to build a lucrative time-share project in Round Hill. The low-wage earners are forced out, property values rise and the environment is saved. But wait, what about the low-wage earners? You know the ones who toil in the tourism industry at Lake Tahoe and make the select few rich. Now your probably asking yourself: Wait a second? How did this editorial get on the subject of low-wage earners? Well it’s simple: Allocations or the right to build are needed to construct apartments, houses, hotels or whatever. In this case, Falcon Capital needed market-rate allocations to build a lucrative time-share project in Round Hill. To do this it bought Lake Park Apartments on Kahle Drive about three years ago, so it could knock them down and transfer the allocations to the Round Hill project. In this situation, the TRPA required Falcon Capital to provide replacement housing for the displaced tenants of Lake Park Apartments. But the replacement housing, Lake Vista Apartments, which is partially funded by federal and state funding sources in the form of grants, tax credits and tax exemption bonds, has minimum income requirements to qualify. If you do not make enough money, you cannot qualify for this affordable housing. And the tenants of Lake Park most likely won’t qualify. Meanwhile the TRPA is playing dumb, acting like they had no idea this was happening. Either they are lying or they are not doing their job. But more importantly what will they do about it? Will the TRPA just hide behind the rules set by the federal government that define affordable housing in Douglas County – rules that don’t meet the needs of the Tahoe Basin and more importantly don’t meet the needs of the Lake Park residents? Will they throw their hands in the air, sigh and say, “Oh well.” And then pat themselves on their backs for creating the first affordable housing project on the Nevada side of the Tahoe Basin? Meanwhile, the TRPA will give Falcon Capital valuable bonus units or free allocations to show its appreciation for their brand new stormwater retention pond and for restoration of the stream environment zone, which Lake Park occupied. Property values in the basin are skyrocketing as it is, but what makes property even more expensive is the cost of TRPA allocations, permits and limitations on density and on land coverage. All these factors drive up construction costs and make affordable housing almost impossible to provide. It’s hard to get a return on your investment when the amount of money you can charge for rent is limited, and therefore the amount of money you have to pay off your debt for the project is limited. So maybe if the TRPA chilled out a little bit, the developers it requires to build affordable housing would be able to afford to build real affordable housing, the kind that low-wage earners, who support the tourism industry, can afford.

U.S. Mint in Carson City Cornerstone 150th re-dedication to be held

On Sept. 24, 1866, at 2 p.m., the Grand Lodge of Nevada, Free and Accepted Masons dedicated the laying of the cornerstone of the original U.S. Mint in Carson City. Exactly 150 years later to the day and time, the Grand Lodge of Nevada, Free and Accepted Masons will rededicate that cornerstone at what's now the Nevada State Museum at 600 N. Carson St. in Carson City. On Saturday, Sept. 24 at 2 p.m., the public is invited to view the rededication ceremony of the laying of that cornerstone. This historic community event will begin with a Grand Procession from Carson Lodge No. 1, Free and Accepted Masons located across the street from the Nevada State Museum. The ceremony will begin at 2 p.m., with the rededication of the cornerstone by the Grand Lodge of Nevada and accompanied by speeches by State of Nevada dignitaries. An open house will follow at Carson Lodge No. 1, Free and Accepted Masons at 113 East Washington Street, Carson City. The public is invited to tour the Carson Lodge building, which is the original V & T Railroad Depot. Carson Lodge No. 1 was the first Freemason Lodge in Nevada and has operated continually since 1862 when it was chartered first in California, then in Nevada when it first became a state. The building is on the National Historic Register for Historic Buildings and features the original Depot clock, a Comstock silver Knights Templar Riding Uniform and a register of all guests to the Carson Lodge with the signature of Brother Samuel L. Clemens (aka Mark Twain). For more information, call Secretary Mike Williams at Carson Lodge No. 1, 530-882-3931.

Scientific study may determine Burke Creek area’s future

Land near a creek at Stateline will undergo an expensive environmental study to determine how building on it would impact the environment. The study will analyze 18 acres between Burke Creek and Lake Village, cost about $250,000 and take up to a year to complete. Results will be included in a developer’s application to the Tahoe Regional Planning Agency to change zoning for the land. The change is necessary if 26 condominiums and 28 units of affordable housing proposed by the developer are to be built on the land. “There are a number of people against the project, many who live in close proximity to the property,” said Randy Lane, managing member of Falcon Capital, a South Shore real estate group paying for the study. “Everybody has an opinion, but it’s not based on science that has been done. Let’s go ahead to an environmental impact statement and determine the impact, if there is any,” Lane said. Five years ago, people who oppose building on the 18 acres formed a group called the Friends of Burke Creek. Michael Donahoe, conservation co-chair of the Tahoe Area Sierra Club, lives in Lake Village and is a founding member of Friends. “The project supposedly includes affordable housing, but there’s no guarantee if it’s approved it has to be built,” Donahoe said. “We’re not sure affordable housing is their goal. It’s definitely something that is needed, but not on raw land right next to a creek.” The land under scrutiny has pitted developers and environmentalists against each other before. In 1990, the U.S. Forest Service made an unsuccessful bid to buy the property, which Bob Rodman, land acquisition at the agency, said qualifies as sensitive because of wetlands and the creek. In 1999, a developer applied for a permit to build 26 condominiums on the property. Environmentalists opposed the project to protect water quality. The Tahoe Regional Planning Agency Governing Board denied a permit for the condos. In May 2002, Falcon, which is working on the project with a group of investors from Incline which owns the 18 acres, went public with its application to change the Plan Area Statement. The Friends has since had two fund-raisers to finance opposition of project. In addition to the land being too sensitive to build on, the Friends say the development would cause traffic gridlock and increase danger for schoolchildren being shuttled to and from Kingsbury Middle School. Falcon says the land has received a favorable rating from the TRPA and is conveniently located by a large employment base and commercial area. Building a large number of residences on the 18 acres became a possibility in 1992 after a land speculator asked the TRPA to change regulations that limited building on the land to one residence. The change required three conditions to be met: Access to the developed area must not be from Highway 50; development must be at least 200 feet from the highway; and that the land is not eligible for affordable housing bonus units. In seeking to change the Plan Area Statement, Falcon wants the TRPA to allow it to change the setback requirement, to allow access from the highway and to gain a preferred affordable housing designation. — Gregory Crofton can be reached at (530) 542-8045 or by e-mail at gcrofton@tahoedailytribune.com