Business climate tangled in red tape |

Business climate tangled in red tape

Susan Wood

Dan Thrift / Tahoe Daily Tribune / Fox Gasoline station owner John Cefalu outlines his plans for changes to the business Wednesday.

Connie Darling may have reached her last straw doing business in South Lake Tahoe when she tried to put up Tibetan prayer flags to promote her international export retail shop.

The city asked her to remove them because of a sign ordinance that restricts banners. At her old location at the Town and Country Center, she waged the same battle over putting out a sandwich board sign, also prohibited.

“I wrote them a letter and told them (the flags are) not banners, but I knew I wouldn’t win,” she said with a sense of surrender. She plans on closing Shop the World within 10 days.

To Darling and other merchants from the “Y” to Stateline, the sign issue is one of many that has become a source of frustration in doing business here.

Small businesses at the lake come and go with the frequency of a revolving door. Some don’t start with a business plan. Others expect more visitors or find advertising to be too expensive. Sales tax, which was raised last year to 7.75 percent from 7.50 percent has proven cumbersome. Good help can be hard to find. And most businesses – small and large – believe the regulatory environment stifles business at an unprecedented rate.

What’s bad for business could be bad for the city, which relies on sales tax dollars to pad its general fund. The local government is in the midst of developing a $37,000 retail study that has determined it misses out on about $219 million a year with retail shoppers drawn elsewhere to spend money.

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Consultant Nolan Rosall of RRC Associates of Boulder, Colo., warned the city the time to act is now.

“You need to turn this boat around,” he told the City Council Tuesday as it listened to Phase 2 of the report that included an abstract action plan. In a month, Economic Development Coordinator Camden Collins will return to the council with more specific solutions of how to retain and attract commerce to the area.

A few hints were given Tuesday.

“I can’t tell you how many people talked about the regulatory issues. This discussion has been around for a long time,” he said.

Other recommendations mentioned were the city developing a “shop local” campaign, nurture outdoor- and visitor-oriented retail establishments and create various tax incentives. There were no specific incentives given. But streamlining the regulatory process came up most often.

That’s what John Cefalu is dealing with in a plan to renovate his half-acre at Highway 50 and Takela Drive where the Fox Station now sits. The estimated $1.5 million stalled project has laid out a concept for new fueling islands and canopy, convenience store and drive-through car wash in the back.

Cefalu said he’s received approvals from the city and the TRPA. His holdup involves Caltrans over ADA requirements. The state transportation department has sent his project into more study than he had planned on. Caltrans spokeswoman Jan Mendoza was unfamiliar with the project as of Wednesday.

“I don’t want to be doing this forever. This is an improvement on a highly visible corner,” Cefalu said. Already, three financing commitments have expired and a few years of red tape have passed.

His suggestion: Make the process for getting projects through easier or at least create a realistic time frame for how much downtime is necessary to break ground.

During Tuesday’s meeting, the council sympathized with Cefalu’s plight.

“(Regulations) have become a hindrance. Why would anyone want to go through the heartache to invest?” Councilwoman Kathay Lovell said.

Councilman Ted Long suggested calls to state legislators. But Mayor Hal Cole wasn’t hopeful that would speed up the process.

Sooze D’Aintree of Sealed with a Kiss at Heavenly Village has three suggestions for the city – parking, parking, parking. The city runs a paid parking garage at the Marriott-anchored complex, but locals aren’t used to paying for it.

“They need to create more and make it more accessible. We’re losing our locals. When we do see locals, they’re surprised to see our discounts (in the store) and that we’re even glad to see them,” D’Aintree said.

Darling said she may have considered moving to the village, but the rent is too high. She says the redevelopment complex takes away business from other local shops at other areas of town.

“If somebody asked me if they should go into business here, I’d say don’t do it,” she said. “It’s not like I’m saying I wouldn’t do it over again, but not until the town settles down. It’s going through a shift.”