Letter: South Lake Tahoe council member says "Now is Not the Time"

Dear Citizens of South Lake Tahoe, Happy New Year! It has been some time since I have written to you as one of your five council members. You, the voters/owners of the City deserve to know what the people you elected are thinking and how they are voting. Since we are starting a new year it seemed appropriate to let you know what this one Council member is thinking.

Our City has a Council/Manager form of government and the City Manager, Public Information Officer, and Mayor are the only ones authorized to speak on issues the Council votes on. No one individual Council member may speak on behalf of the City unless directed by a majority of the council. Also, no one Council member, not even the Mayor, may direct the City staff. It takes a vote of three. We don't always agree on every issue. That is why there are five people elected to deliberate on the issues that affect your lives. Once a vote is taken the manager and staff work to make that direction happen. All of us are allowed to speak or write to you, our bosses, as individuals. That is why I'm writing to you now. It is my opinion that follows. It is also why I have voted no on several recent agenda items.

As a city, we follow a strategic plan that the Council develops, along with the staff, every other January after a new Council is seated. That is our overall plan of work. We meld our respective views into a comprehensive strategic plan to meet the needs of our constituents absent any big emergencies, and put together a timeline for getting it all done. During this process we all agree, by a majority vote, on which items to include in the strategic plan. Unfortunately, right now there is a protocol trick being employed at the end of each council meeting, where one Council member with the consent of only one other member can put an item on the agenda and by default, onto the strategic plan. In my opinion, our Council plans are being hijacked or at least sidetracked by the overuse of this tactic.

I respect that the five council members come from different backgrounds and viewpoints. We see different solutions to common problems and none of us is smarter than all of us. Some on our Council believe that a strong economy with lower taxes is the best way to put food on local families’ tables and roofs over their heads and that our City can have plenty of funds coming in as a result of the greater income flow. Others believe that the government should be solving the issues through taxes, fees, and more laws. I am one of the former.

In my opinion, there is a greedy government tax grab in the works. We now have several taxes and policies being pushed that, in my opinion, will negatively impact the people in this community that they are supposed to benefit. One of these items was voted down previously during our annual planning sessions (and brought back through the above-mentioned protocol trick) and another that was voted down by a majority of the Council after a thorough vetting. Those three taxes are a vacant home tax citizen’s initiative petition, a change to a Charter City primarily to enact a property transfer tax, and a Transient Occupancy Tax (TOT) increase, which if all passed together will take tens of millions of dollars from the local economy every single year. They would nearly double the entire current operational City budget. In addition, there is an item coming up on a near-future agenda to increase the minimum wage in the city limits. Who knows what the impacts of this could be, but I’m certain they will not be positive.

Each of these taxes and policies would have huge negative impacts on our economy, businesses, families, and local workers. One of the ideas behind each one is that anyone who has succeeded or who has more than others deserves to be taxed, with their money given to the government for redistribution to those who have less or are perceived to “need it more.” The reasons given are highly emotional, but the results of the taking/taxing from others never seem to be what was promised.

The voters of South Lake Tahoe have already been generous. In 2010, you voted to approve the School bond measure to upgrade facilities at STMS and STHS. In 2014 you approved Measure F for the Lake Tahoe Community College. In 2016 you approved Measure P for recreation. A new multigenerational Recreation Center is currently being built. You approved Measure S, a 1 percent sales tax increase in 2020. We continued to fund the reopening of Fire Station #2, purchased a multi-million-dollar public safety radio system, and started an aggressive road rehab program with the funds from Measure S. We have also rehabbed miles of roads and filled hundreds of potholes. In addition, we have hired more snow plow drivers and have replaced twelve pieces of equipment, ten graders, and two blowers.

Now is not the time for any new taxes.

Simply put, the City is not broke. I'm on the Finance Sub-Committee and I know the budget well. I know that we have adequate savings for our "rainy days’ fund." Yet some Council members want more from you, using the tactic of claiming they will only tax those "other guys." Believe me, we all end up paying for these tax-grabbing schemes through higher prices.

The two issues that they are using to get you to vote for are transportation and housing. We are on our way regarding housing, even though we cannot solve both Douglas County Nevada's and El Dorado County's housing issues all by ourselves. Transportation is important but current funds can be used. I'm sounding the alarm as one of your representatives that although we have housing and transportation needs, we still have resources available and have already made good progress especially with the 248-unit Sugar Pine Village getting finished as well as about another 250 other housing units in different stages of development.

The City, just as your families are having to do, needs to shift its resources to meet the challenges ahead, live within our means, and not keep going to the tax well on every ballot.

Here are brief synopses of the three tax/icebergs and the bonus minimum wage increase we locals need to steer clear of...

The Vacant House Tax Initiative is being sponsored by extreme far-left proponents and one rogue council member in particular, who are fairly recent big-city transplants who want to try the same policies here that are failures in the big cities like Berkeley, San Francisco, and NYC where they used to live. It's no wonder they have been running short of U-Hauls in California. The initiative sponsors appear to believe anyone who has somehow earned a second home or inherited a family cabin but chooses to not rent it out for whatever reason should then have to pay a whopping $6,000 per year to the city for simply owning that home. Some of these are the very same homes that members of this same group got stopped from temporarily renting out on a short-term basis. They literally, get these homeowners coming and going! It is a “let's get that rich guy” method, that is not working where it has been tried in other places because those "horrible rich people" simply move to a place where they are not punished for being successful. The people who own these homes already pay property taxes, sewer and water, electricity, natural gas, and other fees and taxes while not using those things year-round. That helps offset what we all pay. While questionably legal and under current litigation, just the absence of commonsense and unfairness is so evident. What is next? Will they soon tax us for not driving our cars? They have even thrown in our Schools as a reason to vote for their scheme while the initiative doesn't allocate one single cent to our schools. If passed it will most likely make passing any school bonds more difficult. This tax grab scheme not only violates the Takings Clause of the U.S. Constitution, but It is also taxation without representation, as the plan is to tax homeowners who can't vote here which is another trick of the political trade. I will not sign their petition. I hope you don't either. Now is not the time.

The transfer tax is being reviewed by a two-council member committee, one being our mayor, with the other being that same far-left council member pushing the vacancy tax. Both have already expressed support for the transfer tax that would require our City to be changed into a Charter City. Charter Cities have some benefits but the downsides greatly outweigh those things. Although not currently being proposed, being changed to a Charter City would also make it possible to change our form of government to a “Strong Mayor” system, along with many other detrimental changes that are made possible under the Charter systems.

The increased transfer tax would send some of the equity in a home or business property to the City when it is sold. Simply put, the City would take a share of each sale that the city has done nothing to earn. How is adding to the cost of the sale of property supposed to lower the cost of housing? They say that they would only tax wealthy people who own expensive homes. But just like the income taxes, it is the middle class that these types of things somehow always end up hurting. One of the reasons stated in support of the tax is that it would be an alternative to the already too-high motel tax should tourism drop off. Ironically, real estate sales have also dropped off nationwide and in Tahoe are at their lowest since first being recorded during the Great Depression. Now is not the time.

Transient Occupancy Tax (TOT) is being sought, yet again. Such a blow to tourism while satisfying the anti-tourist sentiments, would make ours one of the highest TOT tax rates in the state and nation Studies have shown that for every percentage point rise in the lodging tax it causes a drop in tourism, causing local jobs to be lost and hours worked reduced. Lodging numbers of room nights sold especially in the Y area of town are way down. TOT is an incredibly volatile source of revenue, why would we then go back to that well and make it more unreliable? Further, those proposing this burdensome tax have not presented anything resembling a plan to replace the funds with another economic generator. They have no plan, except trust us, we'll use it wisely. They somehow imagine that reducing tourism will help our local workers. It makes no sense to throw away our main economic source of putting food on people's tables until they prove that they have some other way of supporting our local families. Now is not the time.

Bonus bad idea. Raising the minimum wage in just our City. When wages go up, prices of goods go up. Businesses here are already closing in record numbers. Denny’s, Jalisco Tacos, Izzy’s, Beach Hut Deli, Lake House, Tep’s Villa Roma, Sato, the Beacon, Lakeview Social, Chevy’s, Alpine Cafe, Hot Pot, KFC, RiteAid, Fresh Ketch, Glazed & Confused, Nel’s, Cup O’Cherries, Lotus Pho, Baja Fresh, Ten Crows, Lilly's Tires, KMart, Raleys, and Alpina. These are just off the top of my head. Businesses like Jack in the Box and others have limited hours. We don't want to be another Aspen where taxes have driven up the cost of goods, housing, and doing business is contributing to the loss of the middle-class locals who are the building blocks of a healthy community. I'm committed to saving the fabric of our community here. Lower taxes and increased business activity have proven to be the tide that raises all ships. Tourism is the horse we will have to ride until something better is created that provides good jobs. I simply don’t understand those who are proposing that we abandon our main source of family income here and have no plan for replacing this current economy except through taxation. Socialism only lasts until they run out of “other people's money.” Further taxing an already hurting populace makes no economic sense.

Many states like Idaho, Utah, and half a dozen others are gaining the job producers that our state and foolish policies like these are driving away.


I will do my part to vote for our City to live within its means while still working on housing and transit. I will vote against new taxes until you, my bosses, are convinced the need is truly there. It's your money and It isn't needed now. Please don’t sign the Vacancy Tax grab petition that is basically (taxation without representation), nor vote for any of the taxes. Having any of these on the ballot will only be divisive to our entire community. We have better things to accomplish instead of fighting off tax-crazed ballot measures. Please let the council members respectfully hear from you through e-mails, letters, and in person. It would help to go on social media to spread the word that no matter the stated need, NOW IS NOT THE TIME.

It is an honor to serve you.

Sincerely,
Tamara Wallace
530-545-2623
twallace@cityofslt.us