Regulations hamper motel owners
Small motels along Lake Tahoe Boulevard display the decline in South Lake Tahoe’s lodging industry. Vacancy signs rarely brighten with an illuminating “No.” Peeling paint and crumbling asphalt speak of hard times.
In a town with motel occupancies that average between 30 and 40 percent, the small motels west of Al Tahoe Boulevard and those within the city limits on Emerald Bay Road endure the lowest incomes. Some are located between noisy commercial businesses lessening their viability as motels.
Yet, with premium highway-front property, many motel owners sit on a potential Comstock that cannot be mined.
At the same time, corporate officials with deep pockets search for space in South Lake Tahoe to open businesses with badly needed services.
What seems like an obvious solution – selling to the highest bidder with a comfortable profit for the property owner – is not easily accomplished in the Tahoe Basin where commerce is regulated to protect the fragile environment.
Motels, zoned tourist-commercial, are not interchangeable with straight commercial uses.
“Under utilized properties would serve better as another use,” said Pembroke Gochnauer, a real estate agent with Aspen Realty who has worked for years to dismantle the wall between buyers and sellers.
“Some of these motels have outlived their economic life,” he said. “In other cities, they would be converted to other uses. (Here) they’re not allowed to seek their higher and better use. They’ve become a blight on the community. With little or no income, they become run down.”
A former board member of the South Lake Tahoe Lodging Association, Gochnauer has become a crusader to change the regulations that block change.
The foundation of the wall lies in the 1980s when the Tahoe Regional Planning Agency developed a master plan for environmental improvements in the Lake Tahoe Basin. The first plan, released in 1984, immediately faced lawsuits from the California attorney general’s office, the League to Save Lake Tahoe, an environmental organization, and the Sierra Preservation Council, a property-rights organization.
The courts ordered all the parties to sit down together and work out a new consensus plan, explained Gabby Barrett, manager of long-range planning at the TRPA and one of those who sat at the table.
The negotiators looked at the capacity of the Lake Tahoe Basin for all types of development such as residential, commercial, industrial, tourism and parking, Barrett said.
He compared the Tahoe Basin to a barrel.
“Only one-third of the barrel is left (for development),” he said.
Negotiators next considered at how to divide the remaining capacity of the “barrel” into various uses.
“In the needs assessment, we determined we really didn’t need more tourist units,” he said, referring to all forms of lodging. “The ones we had were not at capacity.”
The consensus group agreed on allowable levels for each type of property use, but balked when the question arose as to how or why use conversions could happen.
Representatives of the League and the attorney general, said that it was too complicated. Don’t do it, Barrett explained.
“In light of the big picture, we all agreed on that.”
In the 1980s and 1990s, lodging continued to decline as the tourism industry in general declined and the rejuvenating hopes of redevelopment were stalled. Owners of small motels were caught in the quagmire. They couldn’t sell because failing motels were not marketable and regulations prevented conversion to another use.
“The issue is use,” Barrett said. “Right now we’ve got to change the rules to allow this to happen.”
New talks are ongoing to find solutions. It’s not as easy at it appears. Due to the consensus plan of the 1996 and 1997, the new set of negotiators cannot just revise an ordinance to allow conversions.
“We have to keep it in the context of the ’86-’87 plan,” Barrett said, “… Keep it in the barrel.”
Not only must decisions be made on how and why conversions will be allowed, but on a formula for the transfer. In other words, how many commercial square feet does a tourist unit equal?
The rules of use established in the consensus plan, apply to all the defined uses and each has its own growth limit.
“If we allow things to be converted to whatever we want, we may end up having a glut of something else,” Barrett said.
“We can’t let these properties die,” Gochnauer said. “We created their death.”
Tomorrow: Motel owners caught in the middle
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