Letter: Keep Community First Coalition says taxation plan is wrong solution

Dear Editor, The following is a message from the Keep Community First Coalition. We are a coalition of business and community members advocating for thoughtful taxation policies that prioritize sustainable economic growth and community well-being in South Lake Tahoe.

THE WRONG SOLUTION
Housing affordability is a serious concern for South Lake Tahoe, but the proposed residential Vacancy Tax won’t do anything meaningful to help address this challenge for our community. On many levels, it will do a lot more harm than good. Please read on.

LITTLE TO NO NEW HOUSING SUPPLY
A Vacancy Tax won’t increase the housing supply since existing homeowners won’t make their homes available to rent for six months at a time while preserving time to use their homes during prime periods of the year. Similarly, renters typically don’t want to rent for just six months or a partial year and then have to move. These being the facts, the proponent’s claims that the Vacancy Tax will make more housing available are clearly false.

THE CITY DOES NOT HAVE A GOOD TRACK RECORD OF DELIVERING ON PROMISES
For those homes subject to the potential tax, there is no guarantee in the measure that a future city council would use any of the money collected, estimated at $34 million, to develop affordable housing. The city does not have the best track record of spending money for the purposes promised to voters. It is often easier to make promises then to keep them.

THE TOTAL TAX THAT IS CLAIMED WILL BE COLLECTED IS A DROP IN THE BUCKET FOR AFFORDABLE HOUSING
Even if the tax were to work as proponents claim, little if any affordable housing would actually be constructed, certainly in any timely manner. The fact is that developing affordable housing at Lake Tahoe remains a complex and time-consuming process. Land costs are high and the environmental requirements add significantly to both the complexity and timeline. Even projects like Sugar Pine Village, which we actively supported and for which the State of California donated the land, has taken years to develop. Our locally-based coalition and most South Tahoe residents support more affordable housing. The proponents' “pie in the sky” hope that simply infusing money will change reality is neither realistic nor true.

COST TO ADMINISTER AND DEFEND A VACANCY TAX COULD ABSORB MOST IF NOT ALL OF THE FUNDING COLLECTED
The ballot initiative highlights the costly bureaucracy the city would need to establish to continually investigate who is subject to the tax and to enforce and collect the tax. The city will also incur significant legal defense costs as, if the initiative should be approved by voters, most everyone expects the unfair, unjust and illegal tax to be litigated. The administrative and legal defense costs will be paid by the city (and taxpayers) and will be the first call on tax revenue. This will be a financial drain on the city as well as reduce any “new” money for affordable housing.

THE TAX IS UNFAIR AS DESIGNED
The proposed Vacancy Tax is unfair to many members of our community. It treats all second/vacation homes the same, whether it be a small condo, a home that a middle-class family scrimped and saved for years to afford, or a larger home used periodically by families.

Fundamentally, at its core, the Vacancy Tax is taxation without representation.

Families who own second homes in South Lake Tahoe appreciate their opportunity to be part of the fabric of our community. They contribute to the financial well-being and sustainability of our city, our special districts, and local businesses and help keep many of our residents employed.

These are the core reasons our Coalition is actively opposing the proposed residential Vacancy Tax. For more information and additional perspectives, please visit keepcommunityfirst.org

Keep Community First
Steve Teshara, Tahoe Chamber; South Tahoe Restaurant Association
Duane Wallace, South Tahoe Chamber
Sharon Kerrigan, South Tahoe Association of Realtors
Jerry Bindel, South Lake Tahoe Lodging Association
Joby Cefalu, Tahoe Keys Property Owners Association