Letter to the Editor: Now Is the time to solve the housing crisis

Nothing is more appealing than the idea that problems can be solved with no costs to anyone. But that’s almost never true. Facing reality and making choices to solve problems is the mark of an adult. Screaming “no” to everything and ignoring problems is what children do.

Locals need help. Local renters and homeowners need help (homeowners especially, read to the end to learn about how the Vacancy Tax can help with your fire insurance costs). We are losing people. We are losing teachers. We are losing nurses and medics. Barton alone has almost 50 vacant job openings. Since 2000, we’ve lost a staggering 33% of locals aged 25-50 and 36% of local school enrollment, as young families have been pushed out. School funding is based primarily on enrollment, not on local property taxes (which go to the county and state to be redistributed based primarily on enrollment), which is why the district keeps working to raise special assessments. The reason is easy to understand - median home prices have more than doubled, even accounting for inflation.

We have 16,000 housing units, which should be more than enough for our population of 21,000, but instead we have a housing crisis, as nearly half of all units, some 7,000 homes, are kept empty most of the year - an increase of 60% versus 2000. These 2nd homes have come at the cost of local housing. Today, we have some 300 fewer occupied housing units than we did 24 years ago. Let that sink in - since 2000, we’ve lost local housing.

The housing crisis is real. Unfortunately the usual suspects of our City’s moneyed lobbyists, the Realtors Association, the Hotel Lodging Association, and the casino-dominated Chamber of Commerce, have decided that screaming “no” and ignoring problems is easier than solving them. Instead of solutions, they have a slogan: “Now is not the time”. Not the time to invest in workforce housing. Not the time to pave the roads. Not the time to help locals with skyrocketing fire insurance costs.

We have externally imposed land-use limitations, as well as fundamental geographic restrictions, such that private sector development will never meet the demands of both wealthy second vacation home buyers, and our underpaid local workforce. And since McMansion second homes will always be more profitable than homes for teachers, nurses, and firefighters, that’s what gets built.

The most recent South Shore Housing Needs Survey identified that we were short more than 2,000 housing units in 2018, and projected that we would need an additional 3,000 by 2025. That is the scale of the problem against which any proposed solution must be measured. And while the resort and real-estate lobbies insist that “now is not the time” to act on any solutions, some of other right-wing allies are taking the approach of recycling zombie ideas, many of which have been on the books for years. Here’s a few:

Incentive payments for homeowners to rent

Good idea. We already do this. The “Lease to Locals” program offers up to $10,000 to owners of vacation homes to lease their house to local workers. In two years, it’s rented just over 50 houses. That’s quite a bit less than 3,000. The program is also funded with temporary COVID stimulus money that is soon to run out, and there is no clear permanent source of long-term funding.

Just make zoning changes

This is a yes-and, but not enough alone. Tahoe’s housing crisis cannot be solved solely with the stroke of a zoning pen. The best example of this is the recent “Latitude 39” project in Stateline. It is, technically, a high density, high-rise, multi-family housing development - exactly the sort of thing that zoning changes incentivize. But the project is 100% ultra luxury second home condominiums and AirBnB’s which will provide zero housing.

Zoning changes are needed - many have already happened, and more are underway. We need smart mixed-used development, and to allow for modest multi-family split-level houses to be built. But major zoning changes, by law, require environmental impact reviews that cost millions and can take years. Even with the needed changes, without public funding, and a powerful change in incentives for what gets built, private investment money will do what private investment money always does - chase the highest returns - and here, that will always mean luxury vacation homes and AirBnB’s, and never housing for the likes of teachers, nurses, firefighters, ski patrollers, or service workers.

Reduce the costs of permits!

Good idea. We already do this. Housing that is deed-restricted for local workers can get free housing allocation permits, free excess land coverage rights, and a host of other either free or deeply discounted permits. Even so, it is still far more profitable to build second home luxury McMansions, so that’s what gets built.

Other governments and agencies need to solve this!

Passing the buck is not a solution. The surrounding state and regional governments and agencies do not share the priorities of our local workforce, and some are downright hostile to local residents. The idea that other agencies will suddenly change their fundamental interests is disconnected from reality. The Tahoe Conservancy will not suddenly give away all the land they’ve acquired for lake clarity protection for housing development, as proposed in a recent editorial. Neither Douglass nor El Dorado Counties, which see the basin as little more than a wallet from which to extract AirBnB revenue, are motivated to “do their fair share”. The TRPA did make some tepid zoning changes, but still allows for scarce housing allocations to be used for full-time AirBnB hotels, and still prohibits the subdividing of properties for low-cost split-level housing. State laws such as SB9 (requiring multifamily development be allowed in otherwise single-family zones) do not apply in Tahoe as the TRPA, a federal organization, supersedes state land use authority.

The city should just build more workforce housing!

Yeah, we should. This costs money.

Get grants then!

We do that - a lot. Grants help. They also require local matching funds, which requires local housing funding. But more problematically, state and federal housing grants come with extensive strings. Grants like those funding Sugar Pines Village, impose strings that significantly increase construction costs, and, more importantly, restrict housing to low income tenants only. Working professionals such as teachers, nurses, and firefighters, will almost certainly earn too much to qualify, despite often not earning enough to afford quality housing on the open market. This is the “missing middle” problem - it’s why we’ve lost a third of our families. It’s killing our town and grants alone will not solve it.

Sugar Pines will solve it!

The first phase of Sugar Pines will have 64 units of housing. There are plans to expand that to 248 in total, but only the first half of the project is fully funded. Those 248 units will help, but it’s a lot less than the 3,000 we need. And as a grant-funded project, it comes with the above mentioned strings that exclude middle-income earners like teachers and nurses.

What about ?

Yeah, we should build them too. This costs money.

So what’s the solution then?

We need to both change incentives, and raise housing funding. The Vacancy Tax proposal does both simultaneously. It’s a dedicated special-use tax that applies only to houses kept vacant for 6 months or more, and which can, by law, only be spent on housing, roads, and transit, nothing else. Places for locals to live, and roads and buses to get them to work. The measure contains exclusions for active duty military, wildland firefighters, and emergency workers, as well as those in nursing or medicinal care, and exempts entirely seasonal cabins and auxiliary dwelling units (aka “in-law suites”).

As a locally controlled funding free of state and federal strings, the measure provides critical flexibility that grant programs prohibit to both help working locals get housing, but also to help current homeowners stay in their houses. One priority for this revenue is to help both local homeowners and landlords offset the skyrocketing costs of fire insurance - something that all locals, especially retirees on fixed income, desperately need, and which federal and state housing grants can not provide.

This flexibility allows the funds to be used to help the “missing middle” - local working professionals like teachers and nurses who earn too much for grant-supported housing, but not enough for the current market rates and families with children in our community at risk of being forced out. Importantly, the measure raises enough money to make a real difference, enough to buy and renovate the Motel 6 and the dilapidated Sun Ray Inn into new workforce housing - using the properties and buildings we already have, and without needing to cut down open spaces.

It also shifts incentives. Vancouver has had a vacancy tax since 2017, and their latest report showed that “from the 2017 to 2022 reference years, the number of vacant properties decreased by 54%”. They also demonstrated that enforcement isn’t a barrier, with a compliance rate of 96.4%. Here, a shift of vacant homes to occupancy by only 20% - less than half of Vancouver’s results - would add almost 1,400 new housing units, and raise $34 million per year, enough to fully fund our housing needs.

Vacancy taxes aren’t new, and they’re not some “socialist conspiracy”. Utah has had a vacancy tax as part of their property taxes for forty-two years. Utah charges almost double the property tax rate for vacant second homes, than for occupied homes. Utah. Not exactly a leftist state.

We need to solve the housing crisis, not ignore it. The “Vailification” of our town may yield windfall profits for investors and their real-estate lobbyists, but it will come at the cost of our community. We are fast becoming a place where the wealthy can play, but nobody can live.

Locals are what make Tahoe a home, and locals need housing they can afford.

- Scott Robbins