City Council discusses possible funding for housing initiatives, authorizes increased lease at airport

SOUTH LAKE TAHOE, Calif. — On Tuesday evening, South Lake Tahoe City Council voted to sign a five-year lease agreement for city offices, discussed possible sources to fund housing initiatives, and voted to financially support a program focused on taking care of the first responders in the community.

The city council unanimously approved the agreement with PT Revolution to provide public safety employees a wellness and injury prevention program.

Jason Collin, a former city council member and mayor, and owner of PT Revolution, said the return on investment is proven by lowering attrition by being proactive.

“Our team is incredibly excited to be serving our local heroes,” Collin said. “Mental and physical health of first responders needs to be a priority in every community. We believe in taking care of our team members that take care of our community.”

The council voted 5-0 to approve the program and worked together to, in Robbins’ words, “destigmatize seeking mental health care when mental health care is needed.”

With the catalyst of the previous lease agreement expired, Lake Tahoe Airport Manager John Dickinson came before council to address its renewal and terms. 

Dickinson said to be in compliance with the FAA regulations that 30% of the airport used by city council should be leased at a cost commensurate with the fair market value which would result in an increase of approximately $90,000. 

The city council acknowledged that while their lease agreement at Lake Tahoe Airport is anomalous, City Attorney Heather Stroud said, “It is a little unusual” for city offices to occupy space in the terminal but other space is not available that would house City Hall, administrative offices, and a hangar for use by the fire and police departments as the city does, she added.

The masterplan for 56 Acres, according to City Manager Joe Irvin, identified a civic center but said it would take at least a half a decade to make it a reality.

Stroud said in the unlikely event, the termination clause would allow for both parties of the agreement to terminate with 30 days notice which led to council unanimously approving a five-year lease at the new fair market price of $26,570 per month. 

The discussion then turned to housing initiatives and possible funding sources as Zach Thomas, housing manager for the city, presented the housing funding study completed with the help of Aaron Nousaine of BAE Urban Economics. 

In the proposal, Nousaine said that the top contenders were transient occupancy tax, real estate transfer tax, sales and use tax, real estate vacancy tax, payroll expense tax, employee headcount tax, affordable housing in-lieu fee (Inclusionary housing), and business linkage fee as the potential sources.

Intense discussion surrounding the impact on both tourists and locals ensued. 

Council member John Friedrich asked if there would be a negative impact on visitation numbers with the proposed increase in the TOT rate which, ultimately, Nousaine said research had not specifically been done in elasticity between change in TOT and average daily rates. 

Amanda Adams, president of South Tahoe Chamber of commerce and local real estate agent, said that they submitted a three page letter to the council through which concerns of the chamber were expressed regarding the negative impact on visitation due to the economy. 

“There is a reason why our community has pretty often and regularly rejected any increase to sales tax, unfortunately we fear that [increase in sales tax] would force even more locals to shop off the hill which will affect our local businesses,” Adams said. 

One community comment charged the audience and received applause. Kathleen Mason, president of the lodging association in South Lake Tahoe, said, “None of our employees will qualify for Sugar Pine Village because they’ll make too much money. So us having to pay for Sugar Pine Village with a 2% TOT, doesn’t work.”

Many community members stepped forward to provide their ideas for potential funding sources and their view on the analysis with the general consensus being the study did not adequately reflect the reality of the situation due to inequivalent comparisons to areas that do not “face the same problems” as the basin.

“This one is a nonstarter for me, for all of the reasons stated in public comment,” said council member Tamara Wallace. “We should encourage the other agencies (TRPA and STPUD) in town to do as much as we are doing. I think it could be significant. If they were to come to the table in a meaningful way, I think that we should take a step back.” 

“I do not hold out hope that help is on the way,” said council member Scott Robbins and added that he doesn’t think other agencies will step up to support affordability, “this problem is in our chambers.”

The goal would be to decrease numbers and increase revenue per tourist according to Robbins.

“From the traffic mess we have we are not short on numbers. We are suffering from the environmental degradation and consequences of overtourism,” Robbins said.

“You either have tourism or you don’t,” Wallace said. “If you start messing with tourism based on taxing people that could really upset our apple cart and I am unwilling to make those choices because I am unable to make them from a point of knowledge.”

Robbins said, “The idea that we are on the precipice of losing jobs is fear mongering and not reflected by the help wanted signs [in the city].”

No action was taken but several of the proposed tax increases were found unfavorable by council. Additionally, it was requested to be brought back to the agenda after further investigation and community outreach takes place. 

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